By Catherine Reagor | Arizona Republic
Kathleen Black is facing a 50% rent increase on the older three-bedroom central Scottsdale apartment she shares with her four kids and father.
“My apartment’s management is upping my rent by $800 a month,” said Black, who moved from Goodyear to Scottsdale in 2020 after a divorce so her children could go to school with their cousins.
“That will take almost 100% of my income, and my father is on a fixed income,” she said. “Our apartment isn’t that nice.”
Metro Phoenix tenants struggled with some of the biggest rent increases in the U.S. during 2021. But 2022 is turning out to be an even worse year as a growing number of landlords raise rents by more than double last year’s increases.
Many Phoenix-area tenants can’t afford the rent hikes and are afraid they won’t find another place to live.
Some renters must downsize and share bedrooms with children or their parents. Others are considering moving away from metro Phoenix to somewhere more affordable.
Rents shot up almost 30% in the Phoenix area last year, more than double the U.S. increase.
Early projections are for rents to climb almost another 20% in 2022.
But this year’s increases for tenants could be even higher based on the very low 3% vacancy for Valley apartments, the area’s growing population driving up competition, big investors paying record prices for rentals, and 50% jumps in rent increases on recent lease renewals.
A normal vacancy rate for Phoenix-area apartments is about 6%, which means that percentage of rentals are empty. Now fewer than half of the apartments usually available for renters are vacant.
Metro Phoenix’s income-rent gap
New apartments are going up across metro Phoenix, which should ease some of the extreme housing shortage. But most of the new rental homes are high-end and won’t help people who make the region’s median income or less.
The Valley’s income-rent disparity was a problem before last year’s big jump.
Metro Phoenix rents soared almost 80% between 2016 and 2021, according to the real estate brokerage Colliers. The area’s median household income only climbed 22% during the five years, according to the Federal Reserve.
“Valley rents are among the fastest growing in the nation, and wages aren’t growing that fast,” said Mark Stapp, growth expert and director of the Master of Real Estate Development program at Arizona State University. “We have a problem.”
$800 a month rent hike
Black’s monthly apartment payment climbed to $2,430, which is almost 100% of her monthly income.
She works full time for Tuft & Needle. She likes her job but knows she can’t get a pay raise to cover her rent hike.
Black and her family are in one of Scottsdale more affordable complexes, and demand is rising the fastest for those rentals.
The median rent in Scottsdale is about $2,000, up 29% from last year, according to the Maricopa Association of Government’s housing data. The median includes all sizes of apartments.
“I would move back to the West Valley, but apartments there cost as much as the one we are in,” she said. “I can’t believe it’s gotten this expensive to rent. I don’t know what we are going to do.”
Read more (subscriber content)
Some stories may only appear as partial reprints because of publisher restrictions.