Apartments on Union Avenue in St. Louis.
Planning to move next month? You might want to wait. A new study from RentHop suggests you’ll pay a 4.2 percent premium by entering into a new lease in May instead of waiting until January.
Overall, the study found, renting in St. Louis in January could score you a 2.11 percent discount from the norm. Renting in May, on the other hand, sets you up for a 2.1 percent increase.
The difference between the two — the "peak to trough" difference, as authors call it — is one of the larger differences in the 100 cities surveyed across the country. Miami has a 2.2 percent peak to trough difference, for example, while Dallas is at 2.6 percent. Of the ten largest cities in the country, only New York City is higher than St. Louis, with a 4.7 percent differential.
The RentHop study suggests that both weather and student populations are behind the change. It goes to figure: New graduates tend to make their moves right after commencement. And who would choose to deal with snow and ice during their move if they could avoid it?
Interestingly, the study didn’t find a larger student population directly correlated to a larger premium — the authors aren’t sure why. However, they did find correlation between a swing in temperatures and a swing in rents. In places like Miami and Los Angeles, people don’t need to schedule their move for summer to escape bad weather.
As the authors note, while the percent differences may not be big money, they do add up. According to the authors:
Obviously, dollar savings will be smaller in cities where the cost of living is cheaper. The Texas cities, for example, are around 2x cheaper than New York or Boston (so the dollar savings are also much smaller). However, $600-$800 dollars in savings over a 12-month lease is nothing to scoff at. Given the opportunity, renters should opt to end their leases near the wintertime (or at least be wary of non-standard lease terms that might push them off a good cycle). They should also be wary of any discounts from “months free” type concessions which won’t stick around for the next renewal. Note, though, that we’re not considering the potentially lower selection during the winter months. Generally, higher turnover means more possible apartments (though they’ll likely get swooped up faster!).
Our takeaway? If you absolutely have to move next month, try to get on a sixteen-month lease. Anything to get off that costly student schedule.
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