SANTA CLARA, CA — After eight months of consistent slowdowns, rent growth in the nation’s largest housing markets saw its first uptick in March, rising 1.1% year-over-year, according to the realtor.com® Monthly Rental Report released this week. Despite the improvement, the rental markets in pricey high-tech hubs like San Jose, San Francisco and Seattle continue to struggle, creating opportunities for renters.
In March, the U.S. median rent, which is calculated by averaging the median rent of the 50 largest metros, averaged $1,463, a 1.1% increase from a year ago. Over the course of the past eight months, rent growth had slowed from 2.2% in July 2020 to just 0.6% in February.
“Although we’re still below the 3.2% growth we were seeing before COVID, average rent growth in the nation’s largest housing markets saw its first uptick since July 2020, and rents are poised to rise at a quickening pace as recovery continues. However, rents are not rising in all markets. The tech markets and several big metros like Chicago and Los Angeles continue to see rent declines, but generally at a slower pace than in recent months, which could signal a turnaround in the coming months,” said realtor.com® Chief Economist Danielle Hale.
Hale added that as home prices hit record highs and interest rates continue to climb, there may be an increased appetite for rentals as more would-be homebuyers wait for the next season. Rising demand for rentals could gradually push rents higher, eventually to pre-COVID levels after some time.
Two ends of the spectrum
For the third month in a row, New Orleans led the nation in rent growth, with the median rent up 15.6% year-over-year to $1,305. Other markets that saw the median rent increase by double digits were Riverside, Calif., Memphis, Tenn. and Sacramento, Calif. Leading the nation in rent declines were: San Jose, Calif., San Francisco, Seattle, Boston, Los Angeles and Washington, D.C.
Markets With the Largest Rent Increases in March 2021
|1||New Orleans-Metairie, La.||$1,305||15.6%|
|2||Riverside-San Bernardino-Ontario, Calif.||$1,925||13.2%|
|7||Tampa-St. Petersburg-Clearwater, Fla.||$1,413||8.6%|
|9||Louisville/Jefferson County, Ky.-Ind.||$999||8.0%|
Markets With the Largest Rent Decreases in March 2021
|1||San Jose-Sunnyvale-Santa Clara, Calif.||$2,685||-14.1%|
|2||San Francisco-Oakland-Hayward, Calif.||$2,626||-10.1%|
|6||Los Angeles-Long Beach-Anaheim, Calif.||$2,489||-5.5%|
|7||Buffalo-Cheektowaga-Niagara Falls, N.Y.||$1,095||-4.4%|
|9||Minneapolis-St. Paul-Bloomington, Minn.-Wis.||$1,425||-2.1%|
March 2021 Rental Data – 50 Largest Metropolitan Areas
|Atlanta-Sandy Springs-Roswell, Ga.||$1,450||5.7%|
|Austin-Round Rock, Texas||$1,349||-1.3%|
|Buffalo-Cheektowaga-Niagara Falls, N.Y.||$1,095||-4.4%|
|Dallas-Fort Worth-Arlington, Texas||$1,275||1.5%|
|Hartford-West Hartford-East Hartford, Conn.||$1,480||5.7%|
|Houston-The Woodlands-Sugar Land, Texas||$1,199||-0.1%|
|Kansas City, Mo.-Kan.||$1,059||1.0%|
|Las Vegas-Henderson-Paradise, Nev.||$1,250||5.5%|
|Los Angeles-Long Beach-Anaheim, Calif.||$2,489||-5.5%|
|Louisville/Jefferson County, Ky.-Ind.||$999||8.0%|
|Miami-Fort Lauderdale-West Palm Beach, Fla.||$1,886||-0.7%|
|Milwaukee-Waukesha-West Allis, Wis.||$1,335||-1.4%|
|Minneapolis-St. Paul-Bloomington, Minn.-Wis.||$1,425||-2.1%|
|New Orleans-Metairie, La.||$1,305||15.6%|
|New York-Newark-Jersey City, N.Y.-N.J.-Pa.||$2,350||2.2%|
|Oklahoma City, Okla.||$790||-1.0%|
|Riverside-San Bernardino-Ontario, Calif.||$1,925||13.2%|
|San Antonio-New Braunfels, Texas||$1,062||2.1%|
|San Diego-Carlsbad, Calif.||$2,240||2.3%|
|San Francisco-Oakland-Hayward, Calif.||$2,626||-10.1%|
|San Jose-Sunnyvale-Santa Clara, Calif.||$2,685||-14.1%|
|St. Louis, Mo.-Ill.||$1,075||5.9%|
|Tampa-St. Petersburg-Clearwater, Fla.||$1,413||8.6%|
|Virginia Beach-Norfolk-Newport News, Va.-
Rental units include apartment communities as well as private rentals (condos, townhomes, single-family homes). All units were studio, one-bedroom, or two-bedroom units. National rents were calculated by averaging the medians of the 50 largest metropolitan areas.
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