A construction boom in apartments is expected to be bad news for landlords and a positive thing for those looking to rent apartments in Chicago, IL, according to an Appraisal Research Counselors report.
Rental prices in downtown Chicago have been on an upswing for almost seven years, providing landlords with huge gains and leaving tenants with stretched budgets. However, the boom in building activity next year could paint a different picture for apartment rentals.
Appraisal Research Counselors predicted that completed projects by property developers will lead to the launch of over 8,800 apartments in the city’s downtown area between 2016 and 2017. This may affect landlords pricing power due to tightening competition.
Boon and Bane
So how does that translate into good news for tenants? With competition affecting landlords’ ability to quote profitable prices, they not only could lose their pricing power, but also offer discounts or lowered rents among others to fill vacancies.
Average effective rents at top-tier apartments in downtown Chicago rose 3.8% year over year in the second quarter of 2016, due to real estate developers building plenty of high-end properties.
The Appraisal Research report noted that demand for flats has either matched or surpassed supply for the last several years. The strong demand has taken place as employment increases and more people prefer renting to buying residential properties.
Tenant and Landlord Rights
Whether or not you believe renting apartments is a more economical choice, you should still protect yourself by knowing your rights as a tenant or as a landlord, says an expert from Realty & Mortgage.
Some of the issues that result from disputes between landlords and tenants include the return of security deposits, which state laws have applicable guidelines whenever dealing with such lawsuits. By understanding the basic state laws, you may not need a lawyer to stake your claim whether as a tenant or a landlord.