In early January, I touched on the state of the Phoenix rental market, noting that the market had softened substantially beginning in November of 2008. During the final 2 months of 2008, I didn’t lease a single home, and as 2009 started I was still seeing no evidence that a turn around was on the horizon for the Phoenix rental market.
Fast forward 7 weeks to today, and the trend is certain: rental demand is back. I’m not quite ready to say it’s as strong as it was in the summer of 2008, when everything I put on the market seemed to rent in a week, but it’s certainly healthy once again. Personally, I don’t have a property vacancy that has been longer than 2 weeks, and I have only 2 vacancies. Requests for significant price reductions by tenant prospects have all but stopped, while at the same time, the quality of tenant prospects I am finding has once again improved.
Interestingly, I had the opportunity yesterday to talk to Alison of Key Management, a colleague I’ve had the pleasure of working with recently. After we finished talking about lock boxes, keys, and gate codes, I asked her what business was like for Key in late 2008. Key manages ~750 homes, so I figured with their size they would have great data to either confirm or deny my own experience. Alison echoed my results almost exactly, saying it was the worst she had seen in years.
Alison noted just what I felt was true, that around January 15, 2009, the rental market started to pick back up, and has continued to steadily pick up through February. Whatever kept tenants away in late 2008 has gone away, and while I don’t want to say business is booming, it at least looks normal again.
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