Local experts discuss rising rent prices in 2022
Average price for two-bedroom rental rose nearly one-fifth in price since 2021
CHATTANOOGA (WDEF) — According to zumper.com, the rent for a two-bedroom housing unit in Chattanooga is up 19% since this time last year.
The data also shows that the Scenic City is the 63rd most expensive rental market in America.
Zumper’s data reveals that one and two-bedroom rentals were priced at just over $1,200 and $1,400, respectively.
Financial expert Chris Hopkins says inflation and rising interest rates have made it hard for many to afford housing — especially young families.
Hopkins says over the past two years, all housing costs have risen as a result of the pandemic.
As prices suddenly rose, he says many decided to not take their chances on the inflating market and stay put.
“We’ve priced a lot of first-time buyers out of the housing purchase market,” Hopkins said. “Where are they going to live? Well, they’re going to have to turn to an apartment. I suspect that one part of that significant increase is a big increase in demand for two-bedroom units.”
Hopkins also says “household formation” has impacted today’s rental costs.
As more young families began getting married and having kids in 2021, paying off new bills while still dealing with past debt has made buying a home even more unattractive.
“We have seen a sharp increase in younger families getting married, starting their family, looking for a place to live,” Hopkins said. “That has also added to the demand for apartments in addition to the other fundamental considerations, so it’s kind of a pile-on effect of a number of different factors.”
Derek English of Greater Chattanooga Realtors says the appeal of living in Tennessee has only caused more Americans to migrate to Hamilton County.
He says the median price point in the area’s housing market rose to nearly $305,000 this past year — the highest, he says, that it’s ever been.
“Interest rates ticking up to just below seven percent has obviously impacted the buying power for a lot of people who are moving, which probably has, at some point, decreased the availability of rental properties,” English said.
Hopkins says he’s seen studio rentals rise in price significantly, as well.
For local young families currently struggling, he says trying to pay off whatever debt you can while avoiding living monthly off your credit card is imperative in today’s economy, as interest rates are expected to continue rising.