August Rental Data: National Rent Growth Reaches Double Digits for the First Time

Rent Growth Now Outpaces Home Price Growth

Highlights

  • August marks the first month on record where rent growth has reached double digits (11.5% Y/Y). Rent growth now outpaces home price growth (8.6%).
  • August 2021 data: In the 50 largest metros, the median rent was $1,633, up 11.5% year-over-year. This translates to an additional $169 per month for renters. Compared to August 2019, the median rent has increased by $197 (13.7%).
  • Rents by size: Studio: $1,338, up 8.3% ($103) year-over-year; 1-bed: $1,524, up 11.6% ($158);  2-bed: $1,828, up 12.3% ($200). Rents for all unit sizes are at series highs.
  • Rents are increasing the most in Tampa, FL; Riverside, CA; Miami, FL; and Phoenix, AZ metro areas — all saw rents grow more than 25% year-over-year in August.

Rents across the country reached new highs in August, growing by double digits for the first time on record. After months of stalled rent growth during the peak of the pandemic, gradual recovery gave way to price surges in 2021. Now, the national rent has reached $1,633, up 11.5% ($169) year over year, and is growing over 3 times as fast as the 3.2% growth rate seen just before the pandemic hit in March 2020.

Monthly rent growth is still slightly above average at 1.6%, but not as intense as in May and June, when rents increased by 3.0% and 3.2%, respectively, from each month to the next.

Rent YoY Trend Since the Start of the Pandemic

Rent data trend - Realtor.com

In 35 of the 50 largest metro areas, rents reached their highest levels on record and are growing faster than ever. Of the 50 largest metros, all but four saw rents hit new all-time highs this summer (June-August). The holdouts are San Francisco (August 2019); San Jose (March 2020); Boston (July 2020); and New York City (August 2020).

Metro Previous Peak Rent Date of Peak Rent August 2021 Rent Distance from Peak August YY Growth
San Francisco-Oakland-Hayward, CA $3,008 Aug-19 $2,895 -3.8% 1.4%
San Jose-Sunnyvale-Santa Clara, CA $3,127 Mar-20 $2,995 -4.2% 7.0%
Boston-Cambridge-Newton, MA-NH $2,545 Jul-20 $2,499 -1.8% 0.0%
New York-Newark-Jersey City, NY-NJ-PA $2,625 Aug-20 $2,455 -6.5% -6.5%

After months of price declines in the bay area rental market, San Francisco and San Jose are finally seeing rents grow. Rents in San Jose reached $2,995 in August, up 7.0% year over year. Earlier this year, rents in the San Jose area were declining by 14.1%. San Jose’s rents peaked in March 2020 when they reached $3,127, which will eventually be surpassed if the current trends continue.

Following the upward trend, San Francisco rents reached $2,895 in August, up 1.4% year over year. Earlier this year, rents in San Francisco were declining by 12.6% compared to last year. San Francisco rents peaked at $3,008 in August 2019, just $113 (3.8%) greater than the current monthly rent.

Rent Growth Making Up for Lost Time

It’s no secret that home prices have skyrocketed since the pandemic. The demand for larger homes, coupled with inventory shortages, have put upward pressure on home prices over the past year. Home prices have seen double digit growth since last August, and peaking in April when home prices were up 17.1%. The market has since cooled somewhat, and as of August, home prices are up 8.6% over last year.

However, as the for sale market is settling, the rental market continues booming, with rent growth now hitting double digits and outpacing home price growth.

The pandemic caused rent growth to slow to a crawl at the end of last year and into early 2021. Now, into the second half of 2021, improved vaccination rates and the reopening of cities has turbo-charged the rental market, with price growth seemingly determined to make up for lost time. Cumulatively, rents are up 13.7% since Sept 2019 while the median home price is up 19.6% in that period, signaling some more room for rent growth to catch up.

Rent vs Buy Price - Realtor.com

 

National Rents by Unit Size

Unit Size Median Rent Rent YoY Rent Change – 2 years
Overall $1,633 11.5% 13.7%
Studio $1,338 8.3% 8.1%
1-bed $1,524 11.6% 14.3%
2-bed $1,828 12.3% 16.7%

 

In August, two-bedroom units saw the largest increase in rents, with the median rent reaching $1,828 nationally, $200 (12.3%) higher than the same time last year. Thanks to consistent preferences for larger homes over the last couple of years, the median monthly rent for 2-bed units has increased by $262 (16.7%) since August 2019 and is now at the highest level in our data history.

One-bedroom units also saw double digit rent growth in August. The median rent for 1-bedroom units reached $1,524 nationally, up $158 (11.6%) compared to last year. The median monthly rent for 1-bed units has increased by 14.3% ($190) since August 2019, reaching the highest level in our data history.

Studio units are continuing their recovery, with rents reaching $1,338 nationwide in August, up $103 (8.3%) year-over-year.  The median monthly rent for studio units has increased by $100 (8.1%) since August 2019 and is at the highest level in our data history. Nationally, studio rents were dipping by as much as 5% earlier this year, but have steadily recovered as larger cities have seen residents returning.

 

National Rental Trend by Unit Size

Rent price change by unit size - Realtor.om

Tampa, FL was the fastest growing metro area, with the median rent reaching $1,760 in August, up 30.6% year-over-year. The other metros topping the list of fastest growing rents were Riverside, CA; Miami, FL; and Phoenix, AZ, which all saw rents growing by over 25% compared to last year.


 

Top 10 Markets for Rent Increases – August 2021

Rank Metro Overall Rent Overall Rent YY
1 Tampa-St. Petersburg-Clearwater, FL 1,760 30.6%
2 Riverside-San Bernardino-Ontario, CA 2,234 28.6%
3 Miami-Fort Lauderdale-West Palm Beach, FL 2,432 27.0%
4 Phoenix-Mesa-Scottsdale, AZ 1,688 25.5%
5 Las Vegas-Henderson-Paradise, NV 1,515 23.4%
6 San Diego-Carlsbad, CA 2,695 23.4%
7 Memphis, TN-MS-AR 1,200 21.8%
8 Austin-Round Rock, TX 1,618 21.7%
9 Orlando-Kissimmee-Sanford, FL 1,620 21.4%
10 Atlanta-Sandy Springs-Roswell, GA 1,697 21.2%

 

Rental Data – 50 Largest Metropolitan Areas – August 2021

Metro Overall Rent Overall Rent YY 1br Rent 1br Rent YY 2br Rent 2br Rent YY
Atlanta-Sandy Springs-Roswell, GA 1,697 21.2% 1,600 22.2% 1,857 21.8%
Austin-Round Rock, TX 1,618 21.7% 1,486 22.5% 1,809 22.1%
Baltimore-Columbia-Towson, MD 1,685 9.6% 1,600 9.7% 1,782 7.7%
Birmingham-Hoover, AL 1,093 12.7% 1,056 12.9% 1,120 12.6%
Boston-Cambridge-Newton, MA-NH 2,499 0.0% 2,365 0.8% 2,700 -4.9%
Buffalo-Cheektowaga-Niagara Falls, NY 1,195 9.6% 1,070 7.3% 1,355 11.5%
Charlotte-Concord-Gastonia, NC-SC 1,515 17.5% 1,399 17.1% 1,669 17.1%
Chicago-Naperville-Elgin, IL-IN-WI 1,690 -0.3% 1,650 0.3% 1,895 -0.3%
Cincinnati, OH-KY-IN 1,195 12.2% 1,136 9.2% 1,275 10.0%
Cleveland-Elyria, OH 1,105 7.3% 1,075 9.7% 1,205 10.1%
Columbus, OH 1,175 11.4% 1,100 10.6% 1,270 12.4%
Dallas-Fort Worth-Arlington, TX 1,450 16.0% 1,330 17.5% 1,725 19.8%
Denver-Aurora-Lakewood, CO 1,888 14.4% 1,769 16.0% 2,185 15.3%
Detroit-Warren-Dearborn, MI 1,205 9.0% 1,045 10.0% 1,350 7.1%
Hartford-West Hartford-East Hartford, CT 1,525 5.2% 1,425 3.3% 1,700 6.6%
Houston-The Woodlands-Sugar Land, TX 1,300 7.9% 1,195 9.3% 1,474 8.8%
Indianapolis-Carmel-Anderson, IN 1,160 14.1% 1,074 13.7% 1,300 18.7%
Jacksonville, FL 1,406 20.5% 1,315 24.8% 1,533 22.6%
Kansas City, MO-KS 1,149 7.1% 1,045 5.9% 1,350 8.0%
Las Vegas-Henderson-Paradise, NV 1,515 23.4% 1,385 24.8% 1,655 24.6%
Los Angeles-Long Beach-Anaheim, CA 2,800 10.2% 2,550 10.9% 3,374 12.5%
Louisville/Jefferson County, KY-IN 1,030 8.4% 981 6.1% 1,121 13.2%
Memphis, TN-MS-AR 1,200 21.8% 1,181 22.6% 1,250 25.0%
Miami-Fort Lauderdale-West Palm Beach, FL 2,432 27.0% 2,150 26.5% 2,802 24.5%
Milwaukee-Waukesha-West Allis, WI 1,415 5.6% 1,305 2.8% 1,650 9.6%
Minneapolis-St. Paul-Bloomington, MN-WI 1,500 3.4% 1,435 2.9% 1,833 7.8%
Nashville-Davidson–Murfreesboro–Franklin, TN 1,540 16.2% 1,486 18.4% 1,577 13.8%
New Orleans-Metairie, LA 1,329 -3.3% 1,279 -1.6% 1,500 -0.3%
New York-Newark-Jersey City, NY-NJ-PA 2,455 -6.5% 2,275 -9.0% 2,750 -5.2%
Oklahoma City, OK 850 5.1% 759 5.4% 899 2.7%
Orlando-Kissimmee-Sanford, FL 1,620 21.4% 1,513 22.5% 1,818 28.0%
Philadelphia-Camden-Wilmington, PA-NJ-DE-MD 1,630 2.3% 1,580 2.9% 1,845 4.4%
Phoenix-Mesa-Scottsdale, AZ 1,688 25.5% 1,515 27.6% 1,894 26.3%
Pittsburgh, PA 1,395 10.6% 1,350 11.6% 1,512 10.4%
Portland-Vancouver-Hillsboro, OR-WA 1,695 12.5% 1,635 10.9% 1,914 17.1%
Providence-Warwick, RI-MA 1,795 7.3% 1,600 4.4% 2,000 11.1%
Raleigh, NC 1,473 18.9% 1,359 19.7% 1,649 22.1%
Richmond, VA 1,285 12.8% 1,175 15.3% 1,440 15.0%
Riverside-San Bernardino-Ontario, CA 2,234 28.6% 1,900 24.5% 2,545 34.0%
Rochester, NY 1,209 9.4% 1,100 10.1% 1,335 6.8%
Sacramento–Roseville–Arden-Arcade, CA 1,895 18.9% 1,764 18.8% 2,000 18.0%
San Antonio-New Braunfels, TX 1,182 11.3% 1,098 13.8% 1,354 13.9%
San Diego-Carlsbad, CA 2,695 23.4% 2,495 27.0% 2,998 20.9%
San Francisco-Oakland-Hayward, CA 2,895 1.4% 2,690 -0.4% 3,352 -1.4%
San Jose-Sunnyvale-Santa Clara, CA 2,995 7.0% 2,786 7.6% 3,400 6.3%
Seattle-Tacoma-Bellevue, WA 2,053 11.9% 2,068 12.4% 2,299 8.4%
St. Louis, MO-IL 1,155 6.5% 1,129 10.1% 1,240 7.8%
Tampa-St. Petersburg-Clearwater, FL 1,760 30.6% 1,629 35.9% 1,980 35.2%
Virginia Beach-Norfolk-Newport News, VA-NC 1,350 13.4% 1,315 13.6% 1,445 15.6%
Washington-Arlington-Alexandria, DC-VA-MD-WV 2,051 5.7% 1,961 4.6% 2,405 8.5%

 

Methodology

Rental data as of August 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.

Source: realtor.com