This week we continue looking at excerpts from the research in our “By Owner” Corporate Housing Annual Report” by looking at actual rental rates landords charge.
Variances: Changes in Rates. 60% of respondents say they offered the same rental rates in 2013 as they did in 2012. 33% reported they raised their rates in 2013, and only 8% of respondents lowered their rates. The latter is a big improvement compared to two years ago when 16% of people reported lowering their rates.
We asked respondents to evaluate their current rental rates compared to the previous year for the exact same rental property.
- 60.2% say their rates were identical in 2013 and 2012, consistent with last year.
- The great news is that 32.7% report having higher or much higher rates in 2013 – also consistent with last year.
- In 2013, only 7.8% report having lower rates than the previous year. This percentage is up slightly over 2012, but it’s a big and positive contrast to the 2011 annual report in which 16.1% said they had “lower” or “much lower” rates than the previous year.
Actual Rental Rates.
The largest increase in rental rates was for studio rentals, indicating increased demand. Average rental rates went down for 1 bedroom, 2 bedroom, and 4 bedroom properties, after being up in 2012.
We also collected rental rates for month-to-month rentals based on the number of bedrooms in a rental property. Of all the data in this report, these rates vary the most. Compared to our 2012 survey results, 2013 rental rates were both up and down, depending on the number of bedrooms.
The largest increase in rates was for studio rentals, which generally is an indicator of increased demand.
| 2013 Month to Month Rental Rates – What did you charge? | |||||
| Answer Options |
2013 Responses |
2012 Responses |
2011 Responses |
2010 Responses |
2009 Responses |
| Studio |
$2,303 |
$1,892 |
$1,846 |
$1,550 |
$1,500 |
| 1 bedroom |
$2,191 |
$2,408 |
$2,080 |
$2,293 |
$2,353 |
| 2 bedroom |
$2,579 |
$2,722 |
$2,490 |
$2,509 |
$2,683 |
| 3 bedroom |
$3,437 |
$3,188 |
$3,179 |
$2,949 |
$2,739 |
| 4 bedroom |
$3,705 |
$4,423 |
$3,495 |
$3,413 |
$3,983 |
| 5+ bedroom |
$4,704 |
$4,421 |
$5,433 |
$5,413 |
$4,183 |
Rental Discounts.
Consistent with last year, two out of three respondents say they offer discounts for longer-term leases.
In previous annual surveys, we have asked respondents if they offered multiple rental rates, depending on the length of stay of the renter. Traditionally, property owners have a specific discount formula they apply for longer leases of 3 months, 6 months, 9 months or a year.
To simplify this question and better understand how property owners adjust their rates, we changed this question in 2012 to read: “Do you offer a discount, and if so, how much?” This was an open-ended question about what discounts they offered renters for longer-term leases.
In 2013, we were even more specific in how we asked the question. We asked responders to choose from one of five discount ranges, and the results were significantly different than in 2012. We will continue to offer these specific choices in future surveys because we have found this to be the most accurate way to track trends.
Based on our 20 years of experience in corporate housing rentals, we believe the 2013 numbers to be more consistent with current trends.
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