Rental prices rise further than home prices

Rental prices have increased more substantially than home prices.

A recent report from Trulia showed that the rental situation has generated more impressive rises in prices compared to the recovering housing market.

The firm's Price Monitor and Rent Monitor went into detail about the continued improvements for both markets, but showed the rental market gaining more steam. The asking price for homes rose 0.3 percent during June when compared to May's figure. Gains have occurred in this category in four of the last five months.

June asking prices increased by 0.8 percent during the same point when comparing quarter-over-quarter figures, the report explained. When comparing year-over-year figures, the month witnessed a 0.3 percent rise in price. However, foreclosures excluded, the asking price increased by 1.7 percent during the same time period. Nearly half of the largest metropolitan statistical areas had gains year-over-year, while nearly 85 percent of these areas witnessed improvements compared to the same time last quarter.

"We saw asking prices start to rise in February and predicted that other home price indexes would report sales price increases this summer for those homes – and they have," said Jed Kolko, chief economist for Trulia. "Since February, asking prices showed solid gains in four out of five months, including in June, so I expect to see the sales-price indexes show further increases in the months to come."

The rental market experienced price increases in 22 of the 25 largest markets and were 5.4 percent higher than the same point in 2011, the report noted. Rents rose in nearly all of the top rental markets when compared to June of last year. The only market to not have an increase was Las Vegas.

Rent rises improved significantly during the second quarter throughout the U.S., the report said. Property management companies in San Francisco experienced the most impressive gain in June, as the year-over-year rental price increases reached 14.7 percent. In March, this figure was only 10.9 percent.

Oakland had a similar improvement, as the city's rental prices grew 11.2 percent during June when compared to the same time period. the report added. Denver, Miami and Boston all improved by more than 10 percent.

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