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7 Most Expensive Cities to Rent In
Redfin reports that the median asking rent dropped 0.4% to $1,937 in March – its lowest in 13 months. This is the first year-over-year decline since before the pandemic.
But this downward trend doesn’t mean rents are suddenly affordable. Just like with housing prices, the drop in rent is little consolation to many apartment dwellers. Particularly to renters in America’s most expensive cities.
With rent at $1,937, you still need to make roughly $6,457 a month to commit no more than 30% of your income to rent – the accepted standard for measuring affordability. That’s annual earnings of $77,484.
An appropriate headline: Rents aren’t sky-high anymore, but they’re still freaking expensive.
The Unlucky 7
In these seven cities, median asking rent remains above $3,000:
To afford the median rent in New York, you need to rake in about $160,884 a year. In Miami, you need an annual salary of about $122,964.
Median asking rent is higher than $2,000 in 18 of the 43 remaining cities of the nation’s 50 largest.
Homeownership remains more expensive than renting in the loftiest markets.
Recent data from apartment REIT (real estate investment trust) Essex Property Trust (ESS) shows it costs 2.3x more to own a home than rent in the Essex markets of the San Francisco Bay Area, Southern California, and Seattle.
If you’re looking for meaningful relief, you might find it in what were once the hottest rental markets. Rents are down 13% annually in Austin, which leads the list of the 13 metros where prices fell.
The biggest increases came in Raleigh (16.6%), Cleveland (15.3%), Charlotte (13.0%), and Indianapolis (10.5%).
The Bottom Line: While The Juice expects housing prices to renter record territory this year, we wouldn’t be shocked if rentals continue to cost less. At least temporarily. As conditions improve for the most well-prepared buyers, the rush back into homeownership we anticipate should take some pressure off the rental market.
But again, none of this screams affordability. Things just aren’t as crazy as they were last year.
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