Rising Demand Pushes Rents to Double-Digit Growth

With offices reopening, workers are eyeing a return to the city and have needs for new living spaces.
Apartment buildings

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Rents are rapidly rising across the country. The U.S. median rental price jumped 11.5% year over year in August to $1,607 per month. That is the first time in two years that the rental market has reached double-digit growth, according to realtor.com®’s Monthly Rental Report.

More than half of the 50 largest metros posted double-digit annual gains. The highest increases were in Tampa, Fla. (up 30.6% compared to a year ago), Riverside, Calif. (up 28.6%), Miami (up 27%), and Phoenix (up 25.5%).

“August trends suggest rents are making up for lost time,” said Danielle Hale, realtor.com®’s chief economist. “Rents remained low during some of the worst months of the pandemic, growing at a sub-2% pace from September 2020 to March 2021, which is also when for-sale home prices were growing by double digits.”

Hale said the market is seeing urgency among consumers looking for new living spaces. “A lot of this demand can be attributed to vaccines opening up offices and city life, young adults feeling more confident to strike out on their own, and home buyers needing to take a break from the red-hot housing market,” Hale said. “And many are willing to pay top dollar to make that happen quickly, which may lead to even more growth in rents over the next few months.”

Rents continued to lag behind historical peaks in just four major markets, all of which are big tech cities—New York, Boston, San Francisco, and San Jose—according to realtor.com®’s report.

A chart showing August 2021 rental data of the top to markets for rent increases
A chart showing August 2021 rental data for the 50 largest metropolitan areas