The average housing costs increased by over 15% in the past year alone. This inflation makes every renter question whether they’re getting a bang for their buck. Knowing why apartments are so expensive right now can help you figure out what you can do to pay less on rent.
Discover the reason why your apartment is expensive and what you can do about it.
7 Reasons Apartments Are So Expensive
With rising rental costs, renting an apartment can significantly affect your financial health. However, many factors contribute to the price of rent. So when the costs of these factors increase, it causes a ripple effect that leads to a rise in rent prices.
You’ll likely have to pay expensive rent if you decide to live in a popular area or an apartment close to a tourist center. There’s usually a high demand for apartments in these locations. As a result, the rent price increases. But rest assured, you’ll be getting value for your money.
Don’t be afraid to negotiate the rent with the landlord before settling for a price. Platforms like Brixbid make negotiations even easier.
On the other hand, if you are comfortable living a few miles away from more popular areas, your rent will be lower.
2. Facilities and Utilities
Some apartments will come with a utility package, which may include electricity, water, gas, internet, and/or trash.
The advantage is that you don’t have to pay anything after your rent, especially if utility bills are expensive in the area.
So, when comparing rent prices, you need to consider the items included in the rent. Assume apartment A costs $1700 but includes utility bills worth $400, and apartment B costs $1500 but without utilities. The best bang for your buck would be apartment A.
So, at first glance, an expensive apartment might actually turn out to be an affordable choice if the rent includes utility bills.
If an apartment complex owns the land, it will need to pay property tax.
As demand for apartments increases or new developments are introduced to the area, their property tax increases because the value of the complex is rising. The price of renting such apartments will be raised to cover the taxes.
4. Construction, Finishing, and Furnishings
The cost of renting an apartment can be determined by the materials used for its construction and finishing. If it comes with furniture and appliances, expect the rent to be more.
So, if an apartment has high-quality fridges, dryers, cabinets, real wood, etc., the rent may reflect that. For example, many apartments with lower rents use carpets because it’s affordable and easy to replace after a tenant leaves. Landlords use these cost-effective options so they can pass the savings to you in lower rent prices.
5. Parking Space
The parking space is usually a part of the apartment complex’s land and contributes to the rent. Some apartment owners add the cost directly to the rent–whether you own a car or not.
There are usually two types of parking lots at most apartment complexes: covered and uncovered parking lots.
The uncovered parking lot, as its name implies, is usually an open space. It can be free of charge, but if the apartment is in an area with limited parking, they might charge for it.
The covered parking lot has a roof over it or is enclosed. It comes with a charge since it protects your car from sun, rain, and snow. The demand for covered parking lots is high, so you’re likely to pay more for rent where it’s provided.
If you don’t own a car, it’s smart to give up parking space in exchange for a lower rent.
Apartments with desirable amenities can be expensive. This is because modern and convenient amenities don’t come without a cost.
These amenities may include:
Dishwasher: A dishwasher saves you time and effort from washing dishes by hand. But, it can increase the value of your apartment and, with that, your rent.
Pet Policy: Some apartments allow pets, while others don’t. If they do, they’ll usually require a nonrefundable pet deposit with the rent. This fee helps you make up for any damages your pet may cause.
Pool: An apartment complex with a pool will be more expensive than an apartment without one. That’s because the installation of a pool comes with a price, especially if the pool uses heating technology, automatic pool cleaners, chemical feeders, etc. All these costs end up adding to the rent.
Security system: Installed security systems like alarms, video doorbells, or outdoor motion sensor lighting will be added to the basic rent. These amenities make the apartments more expensive, but it is to make you feel safe.
Updated bathroom: Apartments with modern and comfortable bathrooms tend to be more expensive.
Maintenance: Maintenance includes pest control, waste management, insurance, property management fees, routine maintenance, seasonal maintenance, emergency maintenance, painting, flooring, etc. Including these costs in your rent leaves you free to go about your life without worrying about them.
Having these amenities often makes renting worthwhile since you don’t have to worry about maintenance or your comfort. But, it can also make apartments more expensive.
If your water heater breaks down, for example, it could result in a costly fix, especially if it needs a replacement. The apartment will cover the cost. A fixed portion of the rent you pay will go to offset these maintenance costs. Many landlords set aside 10-15% of the gross rent for maintenance.
7. Low Housing Inventory
If you’re wondering why apartments are so expensive generally, you only need to look at the shifts in the housing market. And the primary reason for these shifts is supply and demand.
The demand for apartments is more than the supply, and there aren’t enough houses being built. Because of this, homeownership has become unaffordable, with the prices going up more than 30% over the past couple of years. As a result of high demand and low supply, there’s an increase in rent prices.
Looking for an apartment during early spring can help increase your chances of saving on rent. In Chicago, for example, the best time to get an apartment is in March.
Get Access to the Best Rent Prices on Brixbid
Despite the cost, you can still get your dream apartment at the best price possible. At Brixbid, we help you negotiate the rent and take the hassle out of finding a fair price for your dream apartment.
So, if you’re looking for an affordable apartment in Chicago, Brixbid has a list of apartments you can choose from. What’s more, you can find a place, submit an offer, negotiate the price, and sign a lease all on one platform.
Ready? Get your dream apartment at the best price on Brixbid!