New Hampshire rental market continues to tighten
Market-rate rents, up 4 percent, rose yet again in the last year
The NH Housing Finance Authority’s 2017 survey of residential rental units confirms what those who have looked for an apartment in Hillsborough, Rockingham, Strafford and Merrimack counties already know: It is really difficult to find an affordable place to rent.
In fact, the survey found that the statewide median gross rent of $1,263, including utilities, for two-bedroom units has increased over 4 percent in the last year – the fourth year in a row that rents have increased.
Meanwhile, the vacancy rate continues to decline. This year it stands at 1.4 percent for two-bedroom units. An average vacancy rate of 4 percent to 5 percent is considered a balanced market for supply and demand, according to the housing agency.
According to the survey, all 10 of the state’s counties saw an increase in median gross rent, with rents highest in the southern counties near the state’s largest cities and close to employers as well as the Boston job market. This is also where most of the state’s rental housing properties are located.
To afford the $1,263 monthly statewide median rent for a two-bedroom apartment with utilities, a renter would have to earn 131 percent of the median renter income, or over $50,400 a year.
A 2014 NH Housing study 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 paying this much or more for their housing.
While there has been a recent increase in construction of new rental housing, they tend to be higher-end units with amenities. Young working professionals and older individuals who are downsizing their households are competing for these units, further driving up rental costs. The ongoing tight housing market also reflects low- to moderate-income households that continue to rent because there’s a scarcity of affordable homes to buy.
“To meet the needs of a growing economy, there is a demand for ample affordable housing for workers,” said Dean Christon, executive director of NH Housing. “This continued trend of low vacancy rates suggests that additional rental housing construction is needed to satisfy the demand,”
Last year, he said, NHHFA financed the creation or rehabilitation of more than 1,000 high-quality affordable rental units for working families and seniors, and provided direct rental assistance to thousands of very low-income households. This translates to an investment of about $150 million into the state’s economy last year.
The annual telephone survey, conducted by the University of New Hampshire Survey Center, polled the owners and managers of more than 26,000 market-rate rental housing units around the state – 20 percent of the total number of units in the state.