New projections from forecasting firm Property and Portfolio Research (PPR) suggest average rents and median household incomes will increase at comparable rates, The Wall Street Journal reports.
The forecast indicates rental property management firms and landlords will be able to raise rents in 2012, the news source suggests, rather than having that capability dulled. The slow economy and pace of job creation previously caused some to wonder whether limited consumer finances would prevent such rent increases.
Median income is expected to increase by about 16.1 percent between 2012 and 2016, according to PPR, while rents are projected to grow 15.6 percent during the same period. In the previous decade, PPR's data shows rents rose 8 percent slower than incomes, making this a beneficial change for apartment owners and operators. The source notes that the previous trend may have been caused partly by an unusually high homeownership rate during the decade.
The overall figures are not expected to reflect the state in every market, however. Areas like Washington, D.C., which have already experienced significant rent growth, may find the pace slowing. PPR suggests rent-to-income ratios will remain steady overall, however, and below a peak experienced in 2001.