Survey: Rents continue to climb in New Hampshire
15 percent increase over five years seen across state
'Low vacancy rates suggest that there is a need for additional rental housing construction to meet demand,' says Dean Christon, executive director of NH Housing.
New Hampshire’s ever-tightening housing market is hitting renters particularly hard, according to a survey from the NH Housing Finance Authority. And the solution: new units to meet the demand.
According to NH Housing’s annual residential rental cost survey, which canvasses market-rate units across the state in order to gauge the condition of the rental market, the state’s vacancy rate fell again in the past year, to 1.5 percent, while the median rent for a two-bedroom apartment, including utilities, stands at $1,206.
The survey found that half the counties in the state show vacancy rates at well below 2 percent. Most industry experts consider an average vacancy rate of 4 to 5 percent a balanced market. Below 4 percent constitutes a “landlord’s” market and above that rate it is a “renter’s” market. In comparison, the national vacancy rate fell to 7.1 percent in 2015, which was the lowest rate since 1985, according to NH Housing.
Seven of New Hampshire’s 10 counties have lower vacancy rates than last year. Hillsborough, Merrimack and Rockingham counties all have vacancy rates below 2 percent and are lower than their 2015 rates.
“This continued trend of low vacancy rates and elevated rents reflects both a demographic and economic shift in our state,” said Dean Christon, executive director of NH Housing. “Low vacancy rates suggest that there is a need for additional rental housing construction to meet demand.”
Meanwhile, the survey also found that the state has seen almost a 15 percent increase in rents, including utilities, for two-bedroom apartments since 2011. Over the past five years, the southern tier as well as Grafton and Coos counties have experienced double-digit increases in monthly median gross rental costs.
In addition, according to the survey, the household incomes of renters are not keeping pace with the increase in rents. A renter would have to earn 124 percent of the median income, or over $46,000 a year, to be able to afford the statewide median cost of a typical two-bedroom apartment with utilities, but renter incomes actually declined by 4.3 percent from 2009 to 2014.
“Housing Needs in New Hampshire,” a 2014 study commissioned by New Hampshire Housing, found that almost half of renters in the state pay more than 30 percent of their income on rent, and low-income families are particularly likely to be overpaying for their housing.
For more detailed information, copies of the Residential Rental Cost Survey and Housing Needs in New Hampshire can be downloaded at nhhfa.org.