The national average apartment rent in 2017 increased by 2.5% y-o-y, reached $1,359/month at the end of 2017, according toYardi Matrix
Rent prices fluctuated the most in small-size cities, with the 5 highest y-o-y increases in Odessa and Midland, TX, Buffalo, NY, Lancaster, CA and Reno, NV
New York rents among the top 5 in the nation to decrease the most in 2017, alongside small markets Lubbock, TX, Charleston, SC and Kansas City, KS
Las Vegas rentals saw the highest rate increases in 2017 of all large cities, followed by Detroit and San Diego
The U.S. apartment rent was $1,359 per month at the end of 2017, according toYardi Matrix, about 24% higher than 10 years prior when the national average rent was $1,093 per month. The cost to rent an apartment in the U.S. has been rising steadily over the decade, with the lowest price of $1,052 in May/June/July 2010, and the highest point, $1,363, in August/September 2017.
The average price of one-bedroom units increased the most, by 3.1%, renting for $1,223/month, while the price of studio apartments increased the least, by 2.2%, reaching $1,256/month at the close of the year.
U.S. renters are paying 2.5% higher rents in 2017 compared to the previous year, on average$1,359 per month as of December 2017, $33 more than in December 2016. Across the country, many large cities started to see price decelerations in 2017, while small-size cities were the most vulnerable to rent increases. Five small markets saw the top five highest year-over-year rent jumps in 2017, three of them with double-digit gains:Odessa, TXrents were up 33.6%,Midland, TXrents up 28.2%, and rents in Buffalo, NY increased by 10.3%. Lancaster, CArents went up by 9.8% andReno, NVrents were up by 9.5% year-over-year.
At the opposite end of the charts, the five cities to close out the year with the biggest rent drops were small markets Lubbock, TX(with rent prices down by -6.0% in 2017) andCharleston, SC(down by -1.8%), alongside large marketsManhattanandBrooklynin New York, both of which saw rents decrease by -1.7% in 2017. The fifth wasKansas City, KS, with a -1.6% decrease in apartment rent prices compared to the end of 2016.
Large cities: Las Vegas leads with highest rent increases in 2017
Renting in 2017 was defined by a much-anticipated price slowdown in the nation’s largest and most expensive rental markets. Several large-size U.S. cities have seen rates either decrease, stagnate or grow slower than the national average in 2017, including New York, Austin, San Francisco, and Washington DC, providing renters some respite from skyrocketing prices.
Among the largest U.S. cities,Las Vegasrenters saw the highest price increases in 2017, up by 6.3%, closing out the year at $964/month. Still recovering from the housing crash, Las Vegas was last year’s fastest-growing large urban rental market. Rents have climbed 30% in the last 5 years, from $743/month in 2012, as the Vegas housing market is going through a revitalization process, with new apartment construction picking up starting in 2015.
Another recovering housing market, Detroit, MI saw rent prices go up by 5.6% in one year, now at $1,001/month.San Diego, CA follows closely with a 5.5% y-o-y increase in rents, now exceeding the $2,000 threshold, reaching $2,069/month. They are followed by 2 cities where apartment rents were up 4.9%: Fort Worth, TX, joining the $1,000 club in 2017, finishing the year with an average rent of $1,045/month, and Columbus, OH,with rents hitting $878/month in December.
On the other hand, the bottom five large markets that experienced the lowest rent increases in 2017 are led byManhattan, NYC(-1.7% y-o-y, currently at $4,079/month),Brooklyn, NYC(-1.7% y-o-y, currently at $2,692/month), andPortland, OR(-1.2%, $1,425/month), while apartment rents inOklahoma City, OK remained virtually unchanged from December 2016, at $727/month.Austin, TXapartment rents saw the lowest positive increase of 0.9% y-o-y, reaching $1,305/ month.
All in all, renters in 14 of the largest cities in the U.S. saw average rents either decrease, stagnate or grow slower than the national average of 2.5% this past year. Among them were highly-active markets like Washington, DC, Nashville, TN, and San Antonio, TX, where the high demand for rental housing was met with sufficient new apartments to temperate prices for the time being. Others, like Manhattan, Brooklyn, San Francisco, and Boston, had become so overpriced in terms of rent, that they were due for a correction.
Mid-sized cities: Sacramento struggled with the fastest growing rents in 2017
In the mid-sized city category, the fastest growing rents in 2017 were in Sacramento, CA. As of December 2017, the average rent in Sacramento was $1,294, 8.8% higher than it was one year before. This translates into renters paying a total net amount of $1,260 in additional rent in 2017 as compared to the total rent they paid in 2016. This is after even more spectacular rent increases took place in 2016, when apartment rents had jumped over 12% compared to 2015, ahead of any other city in the U.S. An insufficient stock of apartments has caused rents in Sacramento to skyrocket by 50% in the last 5 years.
The California capital city is followed by Stockton, CA, where rents increased by 7.8%, from $1,007 in 2016 to $1,086 in 2017. The third highest rent increases were in Arlington, TX (up by 6.3%, currently at $966/month) followed by Colorado Springs, CO (up by 6.2%, currently at $1,072/month) and Fresno, CA (up by 6.0%, now up to $984).
The slowest growing rents in mid-sized markets were in New Orleans, down by -0.9% y-o-y, finishing 2017 at $1,089/month. The second slowest mid-sized market in 2017 was Tulsa, OK, where rents increased by only 1.2% over the year, followed by Bakersfield, CA (up by 1.4%), and Wichita, KS (up by 1.8%). In Pittsburgh, PA, a glut of new apartments built in the last 3 years has calmed rising rents in 2017. The average rent price in Pittsburgh in December 2017 is $1,142, just 1.8% more than December 2016.
Small cities: 2017’s national leaders in both highest and lowest rent increases
Renting in small-size cities took the main stage in 2017. The most spectacular rent increases took place in the nation’s smaller markets, with 63% of the cities analyzed experiencing rent growth above the national average.
At the top of the list are two oil-industry-dependent Texas towns that saw rent prices make a major come back in 2017 after free-falling for 2 years due to drops in oil prices. InOdessa, TXthe average rents went up by 33.6% in 2017 compared to 2016 (a $3,420/year net increase) and inMidland, TXthe average rent increased by 28.2% over the same period of time (a $3,408/year net increase). The average rent for an apartment inBuffalo, NY— a city that has built very few new apartments in recent years — passed the $1,000 mark in 2017, reaching $1,016/month, a 10.3% year over year increase (a $1,140/year net increase). A similar gain was seen inLancaster, CA, where rents increased by 9.8% in 2017, as new large apartment developments are non-existent. The average rent in Lancaster, CA is currently $1,166/month. Renters in Lancaster ended up paying a total of $1,248 in extra rent for the year, compared to the previous year. In fifth place for fastest growing rents in a small town isReno, NV. Renters in Reno pay on average $1,117/month, 9.5% more than the previous year (which translates into $1,164 total additional rent paid in 2017 as compared to 2016). These five cities are also the top 5 in the country (out of all 250 cities surveyed) for highest rent increases in 2017.
Other small towns in the news in 2017 are St. Petersburg, FL, where renters have been struggling with rapidly-rising prices. Rental apartments in St. Petersburg cost on average $1,258/month, 9.2% above 2016 levels, and many blame it on a shortage of rentals and insufficient new construction. Modesto, CA was 8th on the list of fastest rising rents, with an 8.0% rent increase.
The biggest rent drops in 2017 were in Lubbock, TX (down by -6.0%, from $955 in 2016 to $898 in 2017), followed by Charleston, SC (down -1.8%, currently $1,225/month), Kansas City, KS (down -1.6%, currently $753/month), Norman, OK (down -1.5%, currently $864/month) and Baton Rouge, LA (down -1.4%, currently $1,046/month).
Look up the average rent in your city in the interactive table below:
RENTCafeis a nationwide apartment search website that enables renters to easily find apartments and houses for rent throughout the United States.
To compile this report, RENTCafe’s research team analyzed rent data across the 250 cities in the US. The report is exclusively based on apartment data related to buildings containing 50 or more units. Our report includes cities with populations over 100,000 and a rental stock of at least 2,900 apartments in 50+ unit buildings.
In this report, large cities are cities with a population of 600,000 people or more, mid-sized cities are cities with a population between 300,000 and 600,000, and small cities are cities with a population of less than 300,000.
Rent data was provided by Yardi Matrix, a business development and asset management tool for brokers, sponsors, banks and equity sources underwriting investments in the multifamily, office, industrial and self-storage sectors. Rental rate coverage is for Market Rate properties only. Fully Affordable properties are not included in the Yardi Matrix rental surveys and are not reported in rental rate averages.
Starting with the January 2017 rent survey, Yardi Matrix is using a methodology that incorporates more properties into the sample which caused slight changes in overall rents and year-over-year changes compared to the previous reports. We expect this methodology adjustment to produce more accurate averages at the national and metro levels.
*National averages include 127 markets across the US, as reported by Yardi Matrix.
Author:Zoran Dobrijevic Phone: 702-477-9133 Dated: February 7th 2018 Views: 128 About Zoran: Zoran knows that Choosing a top-notch real estate agent and taking their advice and guidance can ma...
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