You usually hear about bidding wars in this hot homebuyer's market.
But now, the competition is seeping into the rental market. Rental houses might be the fiercest of them all.
Currently, the average amount of time for a rental home to get snatched up from the moment it's posted on the market is four days or less.
"If you’re not applying right away when you see one, you are passing,” said Chris Nolan, a realtor and founder of Dallas-based Dwellinc, a realty service that specializes in helping people find rentals. “Which has been really frustrating for my clients because obviously, your home is important – it’s going to be the backdrop of your life for the next 12 months and you're having to make that decision within a five-minute span right after you tour."
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He added that many prospective renters are not even taking tours. Competition is so fierce, people are blindly throwing in applications at a moment’s notice before they even see the house in person, which is a strategy that has become the norm in today’s competitive real estate environment.
Nolan said his team has been busy trying to help people sort through the madness.
“Each agent can handle 40 to 45 clients a month. It tells you how many people we need, we started last year and we’ve already grown to a 22 person shop with more needed,” he said.
Dallas has been one of the top rental markets in the country for the past five years. However, it has taken off to new levels since the pandemic.
"When the pandemic hit, the big effect was we lost a lot of construction. So our population growth of around 100,000 people every 10 to 12 months did not slow down but construction did," Nolan explained. "Availability is tight right now, that’s why we’ve been seeing these crazy price hikes."
Rental homes, in particular, have become a hot commodity because people are either selling their houses to make a profit and don't want to downsize in the meantime, or frustrated homebuyers flocking to Texas are turning to the rental market while they wait to buy. That’s in addition to the usual thousands of renters who call DFW home.
As lease renewals come up and the average rent for a two-bedroom apartment in North Texas continues to increase, existing renters are also being flung into the marketplace to hunt for a place to live.
The situation is not isolated to Texas. According to CNBC, the surge in demand and competition has caused rent prices for both apartments and rental homes to go up by $300 to $400 in other hot markets in the country.
Landlords have countless applications to choose from, giving them the upper hand against applicants.
But Nolan said there are things people can do to increase their chances of getting picked.
“I think just being upfront with your documentation is probably the best thing for a rental house. Make sure that your approval process is going to be easy on the owner,” he said. "Because if they get five applications and one isn’t filled out properly or you don’t have the right documentation, it’s just more admin work on their end to get a tenant into their home.”
So whether you're looking for an apartment or house, experts say it's important to have all of your ducks in a row beforehand. Have digital copies of your driver’s license, recent paycheck stubs and even pictures of your pets ready to add to the application.
Keep in mind, with every unit you apply for that doesn't get picked, you will lose that application fee that comes with it.
For now, renters will either need to act fast to snag the home they want or potentially turn to apartment hunting services, which are free to tenants.
“Looking at apartments can’t be your full-time job, looking at rental houses can’t be your full-time job,” said Nolan. “But if you see one come on the market that day that’s going to be highly sought after and you don’t apply that day because you can’t get off work and go see it, the chances of it being there tomorrow are about 50%.”