Something 'striking' is happening with apartment renters

Renting has its benefits.

Renting has its benefits. It’s usually cheaper than buying a home, and it offers the freedom of moving without much hassle. That’s why about half of apartment renters in large urban markets usually move when their leases expire. But that is not happening now.

The low turnover is “striking,” according to real estate analyst Alex Goldfarb at Piper Sandler. He said some of the largest landlords are seeing turnover at just 30% compared with the industry norm of 50%.

He cited reasons including an unaffordable for-sale market, lack of rental supply on the coasts, nervousness about the economy and tariffs, the cost of moving and a shift to suburban apartments, which tend to be larger and more comfortable.

“The consequence is landlords are getting better pricing from renewals, as people don’t want to leave,” said Goldfarb. “It also improves [their] cash flow, because of lower turnover costs.”

Those costs would include repairs, painting and cleaning.