MARKET UPDATE September 29, 2025
Over the past 5 years we have seen rental prices skyrocket in Albuquerque. We were raising rents up to 8% per year in some cases. We were getting houses rented within 24-48 hours of putting a house on the market. That changed about 6 weeks ago. Now we are seeing houses sit for a week with no showings or applications.
WHY IS THIS HAPPENING
There are many reasons why this is happening. CNBC explains why Single-family Rent Growth is Starting to Show New Weakness. Here are their key points:
- Single-family rent prices in July increased 2.3% from the same month last year, which is slower than the 3.1% average increase a year ago, according to the latest data from Cotality.
- Rent growth has now fallen below the lower end of the 10-year average range of pre-pandemic growth.
- “Even markets like Los Angeles, which had been buoyed by post-wildfire demand, are now cooling off,” said Molly Boesel, senior principal economist at Cotality.
Kellogg Agency's pricing strategy has always been to gauge the market on how quickly we can get a house rented and adjust prices accordingly.
PRICE VS VACANCY
Owners have a choice, let the property sit vacant to get a higher price or get it rented quickly. The "rent it quickly" price is the actual market rent. As the saying goes, it will rent for the price people are willing to pay. A vacant house is one of the biggest expenses/losses an owner experiences. In order to get homes rented quickly Kellogg Agency has had to lower prices $100-200/mo in the last few weeks.
SMART STRATEGIES IN A DOWN MARKET
Rental markets are cyclical. Since the Covd Pandemic, we have seen unprecedented annual increases in rents in the Albuquerque and Rio Rancho, NM area. Will this down market last? No. Smart landlords will use these strategies to reduce the chance of a vacancy.
- Keep rent increases to a minimum. Consider a 1-3% increases.
- Keep good tenants. If a tenant takes good care of the property and pays on time, consider not raising rent.
- Keep properties in good condition. Address maintenance issues promptly.
THE BOTTOM LINE
As long term investors know, markets go up and down. Eventually, rental prices will increase again.