The Bay Area, New York City and other hot real estate markets have been coping with rapid rent appreciation for years. Now the rent is surging in smaller markets, raising affordability concerns.
Median monthly rents rose in January, and in a lot of places you might not expect. Along with the usual hot West Coast housing markets, Kansas City, Nashville, TN, Portland, OR, and Charlotte, NC were among the metros with the biggest year-over-year increases.
The new data shows the spread of rising rents, and decreasing rental affordability is likely to follow. Zillow reported last year that renting is now half as affordable as buying, on a monthly basis, in the U.S.
“Since 2000, rents have grown roughly twice as fast as wages, and you don’t have to be an economist to understand why that is hugely problematic,” said Zillow Chief Economist Dr. Stan Humphries. “The rental market used to be, and should remain, a stepping stone to homeownership. But given how widespread rental affordability problems have become, the rental market could be acting more like a barrier to buying.”
This article was published by Emily Heffter on Zillow Blog.