Phoenix ranks in Top 5 for biggest rent increase

Above: Lincoln Ventures is building Moontower PHX, a 24-story, 460,036-square foot apartment building in Downtown Phoenix. Real Estate | 2 Nov |

From Broadway lights to bustling offices, big cities are back – and so are surging downtown rental prices. Following sharp declines during the pandemic, September data shows rents in the 10 biggest U.S. tech cities like Austin and New York surpassed March 2020 levels by an average of 6.3%, according to the Realtor.com Monthly Rental Report released today. Phoenix ranks No. 4 for biggest rent increase, with a year-over-year increase of 26.4%.

Nationally, rents grew at a double-digit annual pace (+13.6%) for the second month in a row.


READ ALSO: Phoenix is No. 1 in U.S. for multifamily construction projects


“With rents continuing to surge to new highs nationwide, including in big tech hubs, September data confirms the U.S. rental market has moved past the recovery phase and is fully back in business. Rental demand remains unseasonably high, driven by still-limited housing supply, rising mortgage rates pushing buyers towards renting, and more people returning to big cities,” said George Ratiu, Manager of Economic Research for Realtor.com®. “At the same time, it’s important to put recent rental activity in the context of housing trends throughout the pandemic. Rents didn’t rebound from COVID declines as quickly as for-sale home prices, but rental activity has now reached a level not unlike the homebuying frenzy seen earlier this year, before fall seasonality kicked in. The good news is that if rents continue to parallel home listing prices, rental price growth could potentially begin cooling this winter.”

Rents surge in major urban tech hubs following steep pandemic declines

While big city rents dropped or stalled during the pandemic as people fled to less expensive and crowded areas, large urban rental markets began to rebound in April 2021 with the rollout of vaccines. However, rent growth in these major metros has found its stride over the past two months, with September data showing big city rents have not only recovered but are making up for lost time. In most counties at the heart of the nation’s 10 biggest tech cities, the September rental growth rate was higher than in March 2020, before the onset of COVID.

• The average rent across the 10 biggest U.S. tech cities grew by 9.9% year-over-year in September and was 6.3% higher than in March 2020. For comparison, average big tech metro rents declined by as much as 7.2% at the height of the pandemic.

• Some of the cities with September’s biggest annual rent gains, such as Austin (+22.3%) and Denver (+15.5%), did not necessarily experience the steepest COVID declines among big tech hubs during the pandemic.

• However, rents are surging even in major metros that experienced some of the nation’s biggest COVID declines. For instance, Los Angeles rents were 8.1% higher in September compared to March 2020, bouncing back from declines of 12.3% at the city’s lowest point during the pandemic.

“The days of rental deals in metros like San Francisco and Manhattan may be over, but there is a silver lining for renters with more flexible timelines. Big city rental competition and high prices is a sign of normalcy, which could precede more seasonal norms like winter cooling in rent growth in parts of the U.S.,” Raitu added. “For renters on tighter schedules, compromises will be key to staying on budget and not getting swept up in bidding wars. If location and size are your must-haves, consider deprioritizing extra amenities or upgrades. You can use tools like the Realtor.com® Rentals app to set up searches and alerts for rentals that match your top criteria.”

Rental prices quicken their double digit pace

For the second consecutive month, national rents grew at a double-digit pace over last year and at a higher rate than in August. September’s rent growth was faster than in a typical year, but month-over-month has been getting smaller since the summer. This suggests a return to seasonality may be on the horizon for this coming December or January.

• In September, the U.S. median rental price reached a new high of $1,654, up 13.6% year-over-year. Annual rent growth in September was four-times faster than in March 2020 (+3.2%), before the onset of COVID. National rents are now 15.5% ($222 per month) higher than in September 2019.

• September’s national rent increase over 2020 was higher than in August (+11.5%), but month-over-month increases have been moderating from the feverish pace seen over the summer, up 3.2% from May to June. In a typical pre-COVID year, rents have historically fluctuated by less than 1% on a monthly basis.

• Nationally, all unit sizes tracked by Realtor.com® saw double-digit rent growth and reached new rental price highs in September. COVID demand for more space continues to drive the highest price growth among larger units, led by two-bedrooms at a yearly increase of 14.4% to $1,855. One-bedroom units also saw a sizable rental price increase (+13.7% year-over-year) to $1,542 in September. For the first time in 2021, studio rent growth hit double-digits, up 11.3% over last year to a median of $1,351 per month.

• Rents grew by double-digits in more than half (31) of the 50 largest U.S. markets in September, led by secondary metros like Tampa (+33.3%). Seven metros posted yearly rent gains of at least 25%; in addition to Tampa, these were: Miami (+31.6%), Riverside, Calif. (+26.5%), Phoenix (+26.4%), Las Vegas (+25.9%), Austin (+25.3%) and San Diego (+25.1%).

Realtor.com® September 2021 Rental Data – 10 Biggest U.S. Tech Hubs

Metro

Pre-
COVID
Rent (Mar
2020)

COVID
Low
Month

COVID
Low Rent

COVID Low
vs. March
2020

Sept. 2021
Rent

Sept. 2021
Rent YoY

Sept 2021
vs. COVID
Low

Sept. 2021
vs. March
2020

Austin, Texas

$1,367

Oct-20

$1,300

-4.9%

$1,647

25.3%

26.7%

20.5%

Boston, Mass.

$1,680

Dec-20

$1,600

-4.8%

$1,895

3.4%

18.4%

12.8%

Chicago, Ill.

$2,300

Apr-21

$2,350

2.2%

$2,500

2.7%

6.4%

8.7%

Denver, Colo.

$2,635

Feb-21

$2,488

-5.6%

$2,850

15.5%

14.5%

8.2%

Los Angeles, Calif.

$1,938

Dec-20

$1,700

-12.3%

$2,095

13.8%

23.2%

8.1%

New York, N.Y.

$1,976

Dec-20

$1,836

-7.1%

$2,075

-3.8%

13.0%

5.0%

San Francisco, Calif.

$1,650

Dec-20

$1,593

-3.5%

$1,695

5.5%

6.4%

2.7%

San Jose, Calif.

$2,480

Jan-21

$2,242

-9.6%

$2,517

10.8%

12.3%

1.5%

Seattle, Wash.

$2,923

Jan-21

$2,610

-10.7%

$2,895

16.7%

10.9%

-1.0%

Washington, D.C.

$3,127

Dec-20

$2,645

-15.4%

$3,015

9.2%

14.0%

-3.6%

Realtor.com® September 2021 Rental Data – 50 Largest Metropolitan Areas

Metro

Overall
Rent

Overall
Rent YY

Studio
Rent

Studio
Rent
YoY

1br
Rent

1br Rent
YY

2br
Rent

2br Rent
YY

Atlanta-Sandy Springs-Roswell, Ga.

$1,720

22.3%

$1,591

16.9%

$1,618

23.1%

$1,878

22.3%

Austin-Round Rock, Texas

$1,647

25.3%

$1,315

21.2%

$1,523

26.7%

$1,835

26.1%

Baltimore-Columbia-Towson, Md.

$1,701

11.0%

$1,495

19.7%

$1,615

10.6%

$1,809

9.6%

Birmingham-Hoover, Ala.

$1,115

14.4%

$1,056

12.9%

$1,070

12.8%

$1,175

18.1%

Boston-Cambridge-Newton, Mass.-N.H.

$2,517

3.4%

$2,195

6.6%

$2,400

5.5%

$2,775

0.9%

Buffalo-Cheektowaga-Niagara Falls, N.Y.

$1,213

13.9%

$795

0.6%

$1,075

8.0%

$1,390

18.8%

Charlotte-Concord-Gastonia, N.C.-S.C.

$1,543

20.5%

$1,402

22.4%

$1,420

19.1%

$1,685

18.4%

Chicago-Naperville-Elgin, Ill.-Ind.-Wis.

$1,695

2.7%

$1,150

-14.8%

$1,650

3.1%

$1,950

2.6%

Cincinnati, Ohio-Ky.-Ind.

$1,200

12.7%

$1,077

12.8%

$1,143

11.5%

$1,275

8.5%

Cleveland-Elyria, Ohio

$1,140

8.6%

$800

4.0%

$1,081

8.5%

$1,235

10.3%

Columbus, Ohio

$1,185

12.5%

$999

13.7%

$1,118

13.5%

$1,282

12.3%

Dallas-Fort Worth-Arlington, Texas

$1,475

18.2%

$1,269

20.9%

$1,357

20.6%

$1,765

22.6%

Denver-Aurora-Lakewood, Colo.

$1,895

15.5%

$1,590

16.0%

$1,771

17.1%

$2,184

16.3%

Detroit-Warren-Dearborn, Mich.

$1,225

7.6%

$995

11.2%

$1,060

8.9%

$1,375

7.0%

Hartford-West Hartford-East Hartford, Conn.

$1,550

7.6%

$1,220

6.1%

$1,445

4.4%

$1,750

9.4%

Houston-The Woodlands-Sugar Land, Texas

$1,319

9.9%

$1,275

13.7%

$1,209

11.1%

$1,485

9.6%

Indianapolis-Carmel-Anderson, IN

$1,168

13.4%

$1,005

9.2%

$1,084

12.8%

$1,309

18.6%

Jacksonville, Fla.

$1,446

23.7%

$1,130

38.1%

$1,359

28.3%

$1,595

28.0%

Kansas City, Mo.-Kan.

$1,150

7.3%

$920

2.8%

$1,043

6.0%

$1,350

8.0%

Las Vegas-Henderson-Paradise, Nev.

$1,548

25.9%

$925

15.6%

$1,422

27.0%

$1,695

27.0%

Los Angeles-Long Beach-Anaheim, Calif.

$2,850

13.8%

$2,122

10.5%

$2,600

14.0%

$3,395

13.9%

Louisville/Jefferson County, Ky.-Ind.

$1,035

8.9%

$890

2.9%

$980

5.4%

$1,164

17.3%

Memphis, Tenn.-Miss.-Ark.

$1,217

22.9%

$1,100

9.5%

$1,195

24.5%

$1,275

25.4%

Miami-Fort Lauderdale-West Palm Beach, Fla.

$2,500

31.6%

$1,972

27.2%

$2,200

29.4%

$2,894

28.6%

Milwaukee-Waukesha-West Allis, Wis.

$1,417

6.1%

$1,100

2.8%

$1,315

4.0%

$1,660

10.7%

Minneapolis-St. Paul-Bloomington, Minn.-Wis.

$1,510

4.1%

$1,200

0.4%

$1,436

4.4%

$1,835

7.9%

Nashville-Davidson-Murfreesboro-Franklin, Tenn.

$1,576

20.1%

$1,555

13.5%

$1,517

22.0%

$1,620

17.5%

New Orleans-Metairie, La.

$1,350

0.0%

$975

-2.5%

$1,300

0.1%

$1,550

4.0%

New York-Newark-Jersey City, N.Y.-N.J.-Pa.

$2,500

-3.8%

$2,250

-2.1%

$2,300

-8.0%

$2,840

-2.1%

Oklahoma City, Okla.

$850

6.4%

$700

0.4%

$760

7.0%

$899

4.5%

Orlando-Kissimmee-Sanford, Fla.

$1,655

24.5%

$1,450

23.9%

$1,550

26.0%

$1,855

30.5%

Philadelphia-Camden-Wilmington, Pa.-N.J.-Del-Md.

$1,649

3.4%

$1,275

0.8%

$1,580

3.3%

$1,850

3.9%

Phoenix-Mesa-Scottsdale, Ariz.

$1,700

26.4%

$1,284

32.5%

$1,530

28.0%

$1,899

26.6%

Pittsburgh, Pa.

$1,415

11.6%

$1,220

15.6%

$1,376

13.7%

$1,560

13.5%

Portland-Vancouver-Hillsboro, Ore.-Wash.

$1,710

14.1%

$1,395

7.4%

$1,656

13.4%

$1,930

17.0%

Providence-Warwick, R.I.-Mass.

$1,795

8.8%

$1,410

-7.5%

$1,600

4.2%

$1,990

13.2%

Raleigh, N.C.

$1,500

22.4%

$1,376

22.5%

$1,390

23.7%

$1,660

23.9%

Richmond, Va.

$1,299

15.8%

$1,085

13.0%

$1,173

15.0%

$1,454

15.8%

Riverside-San Bernardino-Ontario, Calif.

$2,245

26.5%

$1,365

10.5%

$1,905

23.7%

$2,550

31.8%

Rochester, N.Y.

$1,200

4.3%

$875

4.0%

$1,100

4.1%

$1,325

5.6%

Sacramento-Roseville-Arden-Arcade, Calif.

$1,920

20.4%

$1,708

16.8%

$1,800

21.6%

$2,045

20.4%

San Antonio-New Braunfels, Texas

$1,206

13.9%

$1,039

12.4%

$1,130

17.8%

$1,390

16.9%

San Diego-Carlsbad, Calif.

$2,745

25.1%

$2,129

16.3%

$2,539

27.9%

$3,080

23.4%

San Francisco-Oakland-Hayward, Calif.

$2,895

5.5%

$2,395

7.0%

$2,700

5.5%

$3,370

3.1%

San Jose-Sunnyvale-Santa Clara, Calif.

$3,015

10.8%

$2,431

19.8%

$2,789

12.6%

$3,395

9.6%

Seattle-Tacoma-Bellevue, Wash.

$2,095

16.7%

$1,675

12.8%

$2,097

18.1%

$2,375

13.0%

St. Louis, Mo.-Ill.

$1,150

6.0%

$934

4.9%

$1,115

9.2%

$1,225

6.1%

Tampa-St. Petersburg-Clearwater, Fla.

$1,800

33.3%

$1,612

37.4%

$1,673

39.4%

$2,000

34.2%

Virginia Beach-Norfolk-Newport News, Va.-N.C.

$1,365

14.2%

$1,145

7.0%

$1,324

13.5%

$1,455

16.4%

Washington-Arlington-Alexandria, D.C.-Va.-Md.-W.V.

$2,075

9.2%

$1,680

4.9%

$1,991

8.5%

$2,400

9.3%

Methodology

Rental data as of September 2021 for units advertised as for-rent on Realtor.com®. Rental units include apartment communities as well as private rentals (condos, townhomes, single-family homes). All units were studio, 1-bedroom, or 2-bedroom units. National rents were calculated by averaging the medians of the 50 largest metropolitan areas.

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