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A year after landlords were forced to freeze rents and suspend evictions due to the COVID-19 pandemic, many have come back with a bang in 2021 raising rental prices to historically high rates, according to a new report. Zumper rental platform report.
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Zumper’s National Index, based on a survey of 9,057 renters across the country, found the median rental price for a one-bedroom unit rose 11.6% over the year , while the median price of a two-bedroom unit rose 13.6%. . If you want to know how big those increases are, consider this: rental price growth was 0.06% in 2020 and 0.3% in 2019.
Rent increases have been particularly strong for residents of large cities who have benefited from lower prices in 2020. Those residents have had “a rude awakening” this year, Zumper noted, as rental prices in some areas cities have rebounded to pre-pandemic levels and in some cases set new all-time highs.
“In metro areas where single-family homes are the primary form of housing, rents have risen at breakneck speed as home valuations skyrocket, with more tenants who would otherwise buy,” a statement from Zumper press. “There are very few areas of the country where rent is not significantly higher than it was in 2021.”
Topping the list of most expensive rental cities in December 2021 is New York, with a median one-bedroom rental price of $3,190. San Francisco was next with $2,810, followed by Boston ($2,5900); San Jose, California ($2,310); Miami ($2,280); Los Angeles ($2,200); Washington, DC ($2,200); San Diego ($2,160); Oakland, Calif. ($2,030); and Fort Lauderdale, Florida ($2,020).
Other key findings from Zumper’s 2021 Annual Rent Report include:
- Rental prices in many major East Coast cities have surpassed their pre-pandemic peaks.
- Arizona, Florida and Tennessee are among the states that have seen the strongest growth in rents.
- The number of respondents who said they had only applied once during their last apartment search fell by 14.5 percentage points, a sign of the difficulty in finding rentals.
How long these rent hikes will last depends in part on how home sales perform next year. As GOBankingRates previously reported, Realtor.com’s 2022 Housing Forecast predicts that year-over-year U.S. home sales will rise 6.6% in 2022 to their all-time high. in 16 years.
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A separate report from Realtor.com found that buying a first home was more affordable than renting a home in 24 of the 50 largest metropolitan areas in the United States, the Nasdaq reported. Demand for rental housing could ease as more Americans leave their rental homes and move into starter homes, putting more rental units on the market. This could deter some owners from raising prices too high.
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