What's happening in U.S. rental markets?

Renters are a big portion of most global mobility program volumes, so it’s wise for mobility managers to stay aware of what’s happening in their program's destination locations.

In a recent "Rent Café" blog post, there was a report that updated what was happening across the U.S. rental market. Some of the takeaways were:

• The average U.S. apartment rent decreased $9 and reached $1,306/ month according to Yardi Matrix.
• Luxury rents dropped a bit more, down to $1,554.
• California cities make up the biggest portion of the rent-growth list (eight of the top 20), and Stockton (up 12.3% to $1,017) with Sacramento (up 10.7% to $1,196) leading the way.
• San Francisco ($3,342/month), while still being one of the most expensive rental markets actually saw the biggest drop in rents (down 3.6% over the year).

Rent Café suggests: “It seems the recent increase in new construction is creating volatility in the apartment market, cooling down rents across the country." Nationally, “rents dropped by $9 in February, reaching $1,306 on average… while historically tight markets like San Francisco, Houston, Boston, San Jose and New York all saw average rents drop as well.”

Then, there are less populated cities that are seeing serious rent growth, like Mesa and Phoenix, Arizona; St. Paul, Minnesota; Nashville, Tennessee; and Fort Worth, Texas. Mesa actually saw a 6.6% increase year-over-year, while Fort Worth and St. Paul both came in at or over the $1,000 mark. 

The International Monetary Fund offers an interesting comparison of the U.S. markets as a whole to other countries around the world. 

Interestingly, the U.S. has seen housing prices rise faster than rents, although not dramatically more like in Turkey, New Zealand, and Canada.  So, renting may still be a less expensive option for those in the U.S. initially arriving into expensive home-purchase markets, even though rental costs continue to rise in some markets.