Rental prices in Reno are the highest they have ever been in the history of the city.
According to the Nevada Housing Division, the cost of rent has increased 10 percent over the last year and is expected only to continue to rise from there.
The median cost of rent in Reno and Sparks is over $1,000 and a builders’ update forecast expects that price to increase by 4 percent before the end of 2017.
In an interview with News 4 and Fox 11, CJ Manthe from the Nevada Housing Division attributed the increase in rent to the lack of available apartments in Reno. He said Northern Nevada does not have enough inventory to keep up with the high and increasing demand for an apartment in the area. The lack of supply forces prices to increase.
In addition to the lack of inventory, Manthe said the wages in Northern Nevada are not keeping up with rental rates.
According to The Heritage Foundation, wages have grown a little faster than the price of goods in the United States, however, in Northern Nevada and across tthe nation, wages are increasing for high-income earners at about 20 percent, but are increasing little for low-income earners at about 3 percent.
According to the Federal Reserve Bank of New York Consumer Credit Panel /Equifax, the majority of debt for young people stems from car payments and loan debt that deters them from buying houses right away.
Many students at the University of Nevada, Reno are watching with wide eyes as the rental prices for off-campus student housing rapidly increases.
“I like how attending college is so encouraged to the point where they’re saying ‘go to college or you won’t end up happy,’ but then when it comes to paying rent, they talk down to students for creating a greater demand and raising the prices instead of the greedy landlords who will do whatever they can to get more money out of students,” said Daniel Molina, a sophomore at UNR.
Costs of off-campus student apartments have increased significantly since 2015. Today, it costs from $714 to $749 to rent a two-bedroom apartment at The Republic, a student apartment complex only a mile away from the center of campus. Students who have renewed their apartments since last year say that their rent was raised almost $200 in some cases.
“The sad thing is that students don’t have a choice but to pay these high rents because we have to live close to campus and usually have to have furnished places,” said Kenzie Reed, a sophomore at UNR. “These places know they can get a lot of money from students who are pretty much forced to pay for it.”
The average rent for a one-bedroom apartment in Reno rose to $749 from last February to January, a 12.3 percent increase.
Manthe said before the 2008 housing crisis in the U.S., the rate of residents in Northern Nevada who owned a home was 66 percent.
In a report by the apartment search company Abodo, Reno ranked top three in the U.S. cities that saw the largest rent increases from January 2016 to February 2016. Reno ranked third after Milwaukee, Wisconsin and Orlando, Florida.
Manthe said new housing construction projects in Northern Nevada should increase supply, give people more options and help counteract the increasing rental rates.