Nationally, asking prices for condos rose 7.3% year-over-year in September, according to Trulia’s (TRLA) latest rent and price monitor.
That’s more than the 6% increase for single-family homes.
Asking prices for condos rose more than 15% year-over-year in Miami, Denver, and West Palm Beach. Condo prices rose faster than single-family home prices in 18 of the nation’s 20 largest condo markets, Trulia reports.
“Although condo prices are outpacing single-family home prices, they are following similar patterns,” writes Trulia chief economist Jed Kolko. “Condo prices and single-family home prices are both rising faster in metros with stronger job growth and those that had a more severe housing bust in the past decade (a bounceback due to the “rebound effect”). In fact, metros with bigger condo price increases also tend to have bigger single-family home price increases.”
Growth in rents, meanwhile, also outpaced home price gains in September as well, rising 6.5% year-over-year in September.
“Like the for-sale market, the rental market is tighter for multi-unit buildings than for single family homes. Census data show that the multi-unit vacancy rate has been falling steadily, but remains elevated for single-family homes. Despite the multi-unit construction boom, the cost of living in these buildings is rising faster than in single-family homes – both for renters and buyers,” Kolko writes. “This is not necessarily a sign of a permanent shift toward city living. But it certainly reflects a reversal from the past decade’s bubble, when demand was strong for single-family homes in the suburbs and beyond.”