Top five US cities where rent is rising the most nationwide
- Overall, increases have generally cooled after years of increases
- But some major US cities are still seeing rising prices
- The increases are greatest in the Northeast and Midwest
While many renters across the country have enjoyed reprieve after years of steep increases, some metropolitan housing markets continue to trend upward.
According to the latest data, several major cities have again increased rent requirements for tenants year after year.
According to the latest rent prices, the sharpest annual increases occurred in the Northeast and Midwest report from broker.com.
Renters in Chicago saw the biggest increase from March, up 4.3 percent from the previous year.
The move brings the average monthly rent in Windy City to $1,846.
Chicago renters saw the biggest increase from March, up 4.3 percent from the previous year
Renters in New York City felt the squeeze as their average monthly rent rose to $2,876
Renters in New York City also felt the pressure as their average monthly rent rose to $2,876, a 3.8 percent increase from March of last year.
Boston also saw a 3.3 percent increase in the Northeast, bringing monthly rents to an average of $3,023.
According to Jiayi Xu, an economist for Realtor.com, rents in the northeastern region are under upward pressure due to a lack of available land for building new family homes, limiting supply and increasing demand.
Furthermore, “high housing prices in these expensive markets, plus high mortgage rates, may force people to stay in the rental market longer,” Xu explains.
The average income to buy a home across America has risen to $116,000, a recent report shows.
As families are forced to postpone buying a home the longer they stay in the rental market, demand for such rental properties is increasing, Xu added.
Rents in Kansas City’s Midwest rose 3.4 percent and Indianapolis rose 3.3 percent year-over-year, bringing average rents to $1,340 and $1,297, respectively.
βFor Kansas City and Indianapolis, in addition to affordability, they both have strong labor markets, with unemployment rates of 3.6 percent and 3.7 percent [respectively] in February,β said Xu.
A tight labor market with low unemployment can boost demand for rental housing in a city, allowing landlords to raise prices, she explains.
Despite these local increases, rents nationwide have continued to decline for eight months, according to Realtor.com.
In Midwestern Kansas City, rents rose 3.4 percent, bringing average rents to $1,340
Boston saw a 3.3 percent increase, bringing monthly rents to an average of $3,023
Rents in Indianapolis rose 3.3 percent year over year, bringing the average monthly cost to $1,297
Average rents fell for homes of all sizes in the U.S., dropping by an average of 0.3 percent over the past year for homes with two bedrooms or less in the top 50 metropolitan areas.
In the South, rents have fallen by an average of 1.5 percent since the same period last year.
The rising cost of housing has put major pressure on the inflation that has plagued the U.S. economy since the end of pandemic restrictions.
“Stabilizing market rents could make it difficult to see further improvement in the headline inflation rate, which would complicate the Fed’s policy decision and underscore the need for additional housing construction to alleviate the supply shortage,” wrote Xu and Danielle Hale in their report.