Today, I would like to talk to you about how the Santa Rosa rental market is positioned for 2013. I have been with DeDe’s Rentals for nearly 20 years. In that time, I have seen dramatic changes in median rent values throughout the county.
Back in 1995, the monthly rent of an average three bedroom, two bath Santa Rosa home was about $1,000 per month. Over the next five years, between 1995 and 2000, that rent value jumped up to $1,500. It was a rapid and dramatic increase, generated by an impressive increase in home values overall, linked to an increase in local job creation. Rent increases on that scale have not been seen in recent years. The rental growth rate could not be sustained after 2000. From 2000 to 2010, the average rental value for that same 3 bedroom 2 bath home increased only about $100, to around $1,600 to $1,650. There was some growth over ten years, but it was insignificant compared to the previous half-decade. Even within that moderate improvement, rental increases were incremental and subject to downturn. There were periods where rents went up only a little, offset by periods when rents even slipped a little.
However, over the last year or two, we have seen indicators of another improvement in rent values. What once rented for $1,650 in 2010 could conceivably now rent for about $1,750, or even $1,800. I do not expect to see dramatic jumps in rents like we saw from 1995 to 2000. I do believe that the rental market is stronger now than the period from 2000 to 2010, and I think we will begin to see a steady increase of rental prices.
This is a good time to get into the rental market. If you are thinking about becoming an investment property owner, now is a good time to do it. Rents are continuing to appreciate, and will likely continue to climb in the New Year. Interest rates are at historic lows, but sale prices are increasing quickly. If you act soon, you could locate investment properties that make sense for you and for your overall investment strategy.
If you have questions about the Sonoma County rental market, or you are thinking about investing in rental property, please don’t hesitate to give me a call at DeDe’s Rentals. I can be reached at (707) 523-4500, and I would be more than happy to use my 20 years of experience to your benefit. If you have any questions please feel free to contact us at DeDe’s Rentals. We will be happy to help you.