These Are the U.S. Cities Where Rent Is Rising the Fastest, Study Finds
Renter woes are clustered in two U.S. markets, in particular.
Although rents have overall cooled in a nationwide trend, the cost to keep a roof over your head is still becoming increasingly expensive in some markets.
As such, Realtor.com took a look at 50 of the largest metropolitan areas in the country for its latest rent report, and found that 18 were experiencing year-over-year rent increases as of March 2024. And perhaps not coincidentally, the five markets seeing the greatest hikes for studios and one-bedroom and two-bedroom units, specifically, were clustered in the Northeast and Midwest.
In what shouldn't come as a huge surprise, the two markets in the country seeing the biggest spikes in rent are Chicago and New York City, which saw average rents go up 4.3 percent and 3.8 percent, compared to one year ago.
In third place was Kansas City, MO, home to the reigning Super Bowl champions the Kansas City Chiefs, with a modest 3.4 percent increase from last year; followed by Boston, MA and Indianapolis, IN; both at 3.3 percent.
The findings seem to suggest that regional supply and demand is still a driving force when it comes to rent hikes.
According to Realtor.com economist Jiayi Xu, the primary reason for rent increases in the Northeast is a lack of available land for new multifamily construction. And as people struggle to afford homes, they may become trapped in a cycle of renting. "The high housing prices in these expensive markets, plus elevated mortgage rates, may force people to stay in rental markets longer," says Xu.
Meanwhile, low unemployment rates in Midwestern cities may be contributing to the demand for apartments. "For Kansas City and Indianapolis, in addition to affordability, both of them have strong labor markets, with unemployment rates of 3.6 percent and 3.7 percent in February," Xu adds.
You can view the breakdown of the top five, below:
- Chicago, IL: Median rent in March; $1,846 (4.3 percent increase)
- New York City, NY: Median rent in March; $2,876 (3.8 percent increase)
- Kansas City, MO: Median rent in March; $1,340 (3.4 percent increase)
- Boston, MA: Median rent in March; $3,023 (3.3 percent increase)
- Indianapolis, IN: Median rent in March; $1,297 (3.3 percent increase)