U.S. Median Rent Hits a New High at $1,500 a Month, but Rent Growth Slows Heading Into Fall
Annual rent appreciation has slowed in 19 of the 35 largest metro areas, according to the latest HotPads Rent Report
SAN FRANCISCO, Sept. 28, 2018 /PRNewswire/ -- Median rents in the U.S. hit a new high this month, but rents are rising at a slower pace now than they were last year, according to the latest quarterly HotPads® Rent Reporti.
The current median rent in the U.S. is $1,500 per month, up 2.5 percent from last year. As rent prices hit new highs, affordability continues to be a struggle for many renters, making it more difficult for them to save for a down payment or keep up with other rising costs of living such as child care.
While rents have continually risen for more than six yearsii, rents have been rising at a slower pace in recent months. This time last year, rents were rising about 3 percent annually – now, rents are rising 2.5 percent annually.
Rent prices are growing slower now than they were last year in 19 of the 35 largest metro areas. Seattle and Portland, Ore., had the biggest drops in annual rent appreciation. In Seattle, the median rent is $2,225 per month, up 4.3 percent from a year ago. This time last year, rents in Seattle were up 7.7 percent annually. Rents in Portland are up 2.8 annually now but rose 4.5 percent annually at this time in 2017.
Of the 35 largest metro areas, Sacramento's rents are rising the fastest, but annual rent appreciation has slowed in Sacramento as well. Currently, the median rent in Sacramento is $1,940 a month, up 6.5 percent from a year ago. This time last year, rents in Sacramento were up 7.7 percent annually.
Slowing rent growth can come from an influx of new supply or softer demand. Investment in new apartment construction has been very strong in recent years and, at the same time, as the labor market tightens, some renters – particularly higher income renters – are choosing to buy a home instead of rent.
"Rental affordability is still a top concern, but new construction is starting to alleviate supply constraints, taking pressure off the rental market," said Joshua Clark, economist at HotPads. "Waves of new construction have transformed Seattle and Portland, the two metros with the biggest decrease in rent appreciation. While market forces haven't changed to the point that rent prices are falling, renters who have been fighting significant rent increases for years are starting to get some relief. If current trends hold, renters can expect to see rent appreciation stagnate or fall sometime over the next few months to a year, depending on where they are located."
Rent growth has slowed the most among one-bedroom rentals. Currently, renters can expect to spend $1,280 on a typical one-bedroom rental in the U.S. – 2.2 percent more than last year. This time in 2017, one-bedroom rents were rising 3 percent annually. Annual rent price appreciation for one-bedroom units fell the most compared to last year in San Antonio, Washington, D.C., and Seattle.
HotPads is a Zillow® Group-owned apartment and home search platform for renters in urban areas across the United States. For more information on the U.S. rental market, visit HotPads.com.
All Rentals | One-Bedroom Rentals | |||||
Metropolitan | Median | YoY | YoY Change, | Median | YoY | YoY Change, |
United States | $1,500 | 2.5% | 3.1% | $1,280 | 2.2% | 3.0% |
New York, NY | $2,360 | 1.1% | 1.9% | $2,030 | 0.9% | 1.6% |
Los Angeles, CA | $2,890 | 4.2% | 5.5% | $2,120 | 4.6% | 7.0% |
Chicago, IL | $1,780 | 1.9% | 2.3% | $1,550 | 1.4% | 2.5% |
Dallas, TX | $1,655 | 3.1% | 4.0% | $1,045 | 2.3% | 3.6% |
Philadelphia, PA | $1,665 | 2.2% | 2.3% | $1,375 | 2.1% | 1.6% |
Houston, TX | $1,585 | 2.7% | -0.4% | $965 | 2.8% | -2.0% |
Washington, DC | $2,170 | 1.4% | 1.9% | $1,805 | 0.7% | 1.8% |
Miami, FL | $2,005 | 2.3% | 2.3% | $1,415 | 1.8% | 1.5% |
Atlanta, GA | $1,450 | 5.1% | 5.1% | $1,355 | 4.8% | 4.9% |
Boston, MA | $2,405 | 3.1% | 3.9% | $1,905 | 2.1% | 3.4% |
San Francisco, CA | $3,460 | 3.2% | 3.4% | $2,480 | 2.2% | 2.4% |
Detroit, MI | $1,285 | 3.6% | 3.3% | $1,090 | 4.0% | 5.2% |
Riverside, CA | $1,930 | 5.7% | 5.2% | $1,245 | 6.2% | 5.8% |
Phoenix, AZ | $1,470 | 5.7% | 5.1% | $1,145 | 6.7% | 6.8% |
Seattle, WA | $2,225 | 4.3% | 7.7% | $1,760 | 3.1% | 7.5% |
Minneapolis, MN | $1,670 | 3.9% | 4.0% | $1,265 | 3.5% | 3.4% |
San Diego, CA | $2,680 | 4.8% | 5.4% | $1,835 | 5.7% | 6.3% |
St. Louis, MO | $1,195 | 2.1% | 2.0% | $880 | 2.2% | 3.0% |
Tampa, FL | $1,460 | 4.6% | 4.3% | $1,105 | 5.6% | 5.4% |
Baltimore, MD | $1,745 | 1.0% | 0.7% | $1,390 | 0.5% | 0.2% |
Denver, CO | $2,100 | 3.7% | 3.8% | $1,365 | 3.0% | 3.5% |
Pittsburgh, PA | $1,095 | 2.0% | 1.3% | $905 | 2.1% | 1.7% |
Portland, OR | $1,930 | 2.8% | 4.5% | $1,570 | 2.3% | 3.6% |
Charlotte, NC | $1,370 | 3.8% | 4.3% | $1,110 | 3.4% | 3.5% |
Sacramento, CA | $1,940 | 6.5% | 7.7% | $1,420 | 8.1% | 10.4% |
San Antonio, TX | $1,380 | 2.3% | 2.9% | $860 | 0.9% | 2.6% |
Orlando, FL | $1,505 | 5.5% | 4.5% | $965 | 6.0% | 4.6% |
Cincinnati, OH | $1,220 | 2.9% | 3.4% | $885 | 3.0% | 3.9% |
Cleveland, OH | $1,195 | 2.2% | 1.6% | $940 | 3.3% | 3.7% |
Kansas City, MO | $1,250 | 3.1% | 3.5% | $885 | 3.3% | 4.1% |
Las Vegas, NV | $1,395 | 6.1% | 4.5% | $965 | 6.7% | 5.4% |
Columbus, OH | $1,420 | 3.8% | 3.3% | $980 | 3.8% | 3.2% |
Indianapolis, IN | $1,235 | 3.4% | 2.5% | $875 | 3.0% | 3.3% |
San Jose, CA | $3,685 | 3.5% | 2.0% | $2,585 | 3.6% | 2.0% |
Austin, TX | $1,735 | 1.4% | 2.0% | $1,340 | 1.0% | 1.6% |
HotPads
HotPads is an efficient rental search platform for urban areas across the United States, with features designed for competitive markets such as map-based search, real-time notifications and detailed information on landlords and property managers that help renters spend less time searching and more time feeling excited about their next home.
Launched in 2005, HotPads is based in San Francisco and is owned and operated by Zillow Group, Inc. (NASDAQ:Z and ZG).
HotPads is a registered trademark of Zillow, Inc.
i The HotPads Rent Report is a quarterly overview of the median rent for houses, condos, apartments and other home types in the United States and the top 35 most populous metro areas. Data are aggregated from rental listings on HotPads dating back to January 2012. The reports are compiled by the HotPads Economic Research team. HotPads tracks data for rental and housing markets throughout the United States, with select data available on the city and neighborhood level within the top 35 metros.
ii Rents have risen year-over-year every month since January 2012, the earliest month available from HotPads data.
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SOURCE Hotpads, Inc.
