Suburban Philly is one of the most competitive rental markets in the United States

Suburban Philadelphia is one of the most competitive rental markets in the country – more competitive than the city of Philadelphia.

Suburban Philadelphia ranked as the 17th most competitive rental market, according to a report by online rental marketplace RentCafe. The analysis took into account occupancy rates, rental supply, the number of tenants competing for each rental and rental renewal rates.

The Philadelphia area as a whole attracts out-of-town renters due to its location, relatively affordable price, variety of jobs and schools, and position as a major metropolitan area.

“People who move here know that in Philadelphia you get big city living for pennies on the dollar” compared to other major US cities, said Chris Coulton, a realtor with brokerage firm BMB Living. Inc. based in Center City. And Philadelphia is easy to get to for people who want more space in the suburbs.

READ MORE: Philadelphia-area renters have fewer options than most

Coulton said he fielded calls weekly from tenants wanting to move to the area from places as far apart as California, Nebraska, Florida and North and South Carolina. Last year, he moved in with 10 people from Texas.

Suburban rentals tend to be larger, and households have prioritized space during the pandemic. Aging millennials are looking for more space when starting a family, and more and more young people are renting longer due to lifestyle choices and rising buying costs. Rentals are also generally harder to come by in the suburbs, as these towns don’t have the density of big cities, so tenants may face more competition.

Most customers who call Coulton looking for rentals outside of Philadelphia want to live on the main line. But many have ended up buying there instead of renting, he said, because rental prices are high and “often the options are really scarce.”

» READ MORE: Takeaways from one of Philadelphia’s largest renter surveys

Renting single-family homes has become more popular, helping to drive rental demand in the suburbs, said Doug Ressler, head of business intelligence at real estate data firm Yardi Matrix, owned by RentCafe’s parent company. based in Arizona.

Convenience, accessibility and affordability drive renters’ choices of where to live in the area, said Bill Lublin, general manager of CENTURY 21 Advantage Gold, based in Northeast Philadelphia and active in the whole region. Where tenants work and whether they can work from home, whether they have school-aged children, and lifestyle are all demand factors.

Lublin, president of property management company Lublin Corporation Realtors, said he’s seeing “tremendous demand” for rentals in Philadelphia and the Pass Counties of Pennsylvania and New Jersey. This demand has resulted in the substantial growth in rents, he said.

Lublin’s property management company manages townhouses all over the city, and “all of them are renting out very quickly”, he said.

“We have a huge millennial generation, some of whom are leading the buy market, but some of whom are just not quite ready or quite sure, so they are leading the rental market as opposed to the rental market. purchase,” he said.

» READ MORE: Tenants face bidding wars in a fiercely competitive market (May 2022)

On average, vacant rental units in suburban Philadelphia were occupied in 42 days during the first four months of 2022, according to RentCafe’s analysis of market-priced properties of 50 or more units. And 14 tenants competed for each rental.

In Miami-Dade County, the nation’s most competitive rental market, vacancies were filled in an average of 27 days and 31 tenants competed for each. Harrisburg ranked as the second most competitive rental market in the nation. The city of Philadelphia is not on the list of top 20 markets.

Rent Scene, the rental arm of BMB Living that connects renters and rental property owners, sees Philadelphia’s vacant rental units fill in about 30 days, Coulton said. And tenants generally don’t face “app wars,” he said.

At the end of the summer, renters can expect fewer available rentals in a normal seasonal downturn in rental activity, Coulton said. The rental market is balancing out, he said, and he expects rental growth to continue to slow.

Nationally, the gap between urban and suburban rents has narrowed during the pandemic as remote working has become more popular, according to an analysis of the nation’s 50 largest metro areas by Suburban rental price advantage increased from $175 to $107 from July 2019 to July 2022.

Median rent in urban parts of the metro area – defined by as the cities of Philadelphia and Wilmington – fell below median rent for the first time in suburban parts of the region – defined as everywhere else – in 2021.

The median suburban rent was $1,438 in July 2019, compared to $1,715 in the city. In July, the median rent in Philadelphia and Wilmington was $1,750 in July, up 6% from a year ago. Suburban rent was $1,925, up 10% from a year ago.

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