SALT LAKE CITY — With jobs plentiful and housing units in high demand, the cost of renting an apartment along the Wasatch Front is continuing to climb into the third quarter of this year, a new report states.
Research from real estate investment services firm Marcus & Millichap showed strong job growth among degreed professionals is fueling demand in an already robust apartment market.
The Salt Lake City metro area continues to register vacancy rates that are well below the national average despite relatively small quarterly increases generally triggered by an influx of development, the report says.
The lowest vacancy rate occurred in the Ogden/Weber County submarket registering at 3.1 percent overall, while the Orem/Lehi area registered the highest among the areas measured at 4.8 percent. The highest rents were found in the Downtown Salt Lake City-University submarket at $1,237, while the Ogden/Weber County area registered the lowest rents at $911 — the only locale to register below the $1,000 threshold.
Looking ahead, the report indicates that low vacancies should continue as demand for rental units start to outpace the supply of new construction available for occupancy.
Due to the high demand, the cost to rent an apartment is expected to rise, pushing average monthly rental costs above the $1,100 mark, the report adds. The largest rent increases are anticipated in the Class C market, particularly in locations near the urban core.12 comments on this story
The report indicates that developers will continue to target areas near the main employment hubs of urban communities. Apartment development remained concentrated in downtown Salt Lake City over the past year, according to the report, along with locales in the south Salt Lake Valley.
Developers have focused on construction in proximity to large corporate campuses that employ high numbers of millennials, the report states.
Through year’s end, construction in the urban core is expected to increase as the downtown area takes on 800 new units in the latter half of the year.