Average rent hits a new high in Modesto. Study charts the changes over a decade
People who live in rental housing watched the average cost for apartments in Stanislaus County soar by more than 60 percent since 2012.
The monthly rental average in Modesto reached $1,265 in November, a 6 percent jump over the previous year, according to the online service RentCafe. Seven years ago, the average rent for apartments was around $780 a month. A new law in California that took effect Jan. 1 caps rent hikes at 5 percent each year plus inflation.
An end-of-decade report from RentCafe charted the changes in the rental market that make it tough for wage-earners today to find an affordable place to live. The average renter today is paying almost $6,000 more for housing annually than a decade ago.
RentCafe analyzed data back to 2012 or earlier for apartment complexes with 50-plus units. Those apartments typically cost more because they have more amenities than what’s offered at smaller apartment buildings and duplexes.
A serious slowdown in housing construction in the 2010s served to limit the supply of rental housing in the Modesto area, even after post-recession hiring picked up in the region.
Modesto added 800 new dwellings between 2010 and 2018; at the same time, the city’s population swelled by 12,000 residents. Closer to 3,500 additional dwellings were needed to house that population.
The economy added more than 18,000 jobs in the Modesto area from 2008 to 2018, or about four jobs for every building permit issued for housing, according to another online service, Apartment List.
RentCafe found that, in the past decade, the number people in single-family rental homes rose by 5 percent, while the percentage in multifamily housing shrank by 3.5 percent,
In Turlock, the share of households in rental housing increased by 15 percentage points, from 25,128 households to 38,158 between 2010 and 2018, causing a significant shift in the city’s real estate market. Today, the majority of Turlock households are renters rather than homeowners, according to the RentCafe report.
According to the latest count, Modesto has 118,626 homeowners compared to 93,850 renters.
RentCafe also tracked an increase in high-earning renter households nationwide, or people earning more than $150,000 a year who rent as a lifestyle choice. Presumably, moving to another neighborhood or city is easier for these high-earning households if they’re not shackled to a mortgage, though prices for real estate discourage buying in some parts of the country.
Fresno had the nation’s third largest increase in high-income renters over the past decade. Those renters tripled their numbers in Modesto while the number of high-income homeowners almost doubled. Modesto now has around 1,000 high-income renters; the number of homeowners in that income category grew from 3,629 to 6,772.
The study noted a 27 percent increase in younger adults (age 34 or younger) owning homes in Modesto. Home ownership among seniors (age 60 and older) was up 12 percent.
This story was originally published January 14, 2020 at 8:52 AM.
