The Apartment Guide 2019 Annual Rent Report
The Apartment Guide 2019 Annual Rent Report highlights trends and price fluctuations that renters can expect to find in different places across the country. The report compares prices for studio, one-bedroom and two-bedroom apartments for rent to determine which areas of the country or cities are becoming more expensive or more affordable for renters.
Plus, we analyze a key few takeaways and insights from our findings – such as rental unit availability, a push for new and luxury apartment properties and regional population changes – to educate renters about the trends they will be experiencing when searching for a new place to call home.
I. National Trends
II. Regional Trends
III. 10 Cities With Biggest Rent Increases
IV. 10 Cities With Biggest Rent Decreases
V. Rent in 100 Largest Cities
VI. Key Findings
VII. Research Methodology
- Average rent on one-bedrooms rose 4.2 percent nationally in 2018 to $1,140.
- Similar increases were seen nationwide for two-bedroom units, which rose from $1,302 to $1,354.
- Studio rents rose at a somewhat higher rate of nearly 5 percent to $1,065.
Rents rose in each of the four U.S. Census Regions1 by an average of 4 to 5 percent in 2018.
In the West, average rents were about 60 to 75 percent of the amounts seen in the Northeast.
Rental prices in the Midwest and South held at roughly 45 to 50 percent of those seen in the Northeast.
- In the historically affordable South region, demand fueled a significant 8.1 percent average increase in studio apartment rents, from $962 in December 2017 to $1,040 by the end of 2018.
- Rents on two-bedroom apartments in the South were less active, with an overall average increase of just 1.7 percent.
In the Midwest region rents on two-bedroom units saw the greatest increases, as demand fueled a 4.1 percent average rise, in contrast to 2.5 percent for one-bedroom apartments and 3.8 percent for studios.
- In Chicago, the Midwest region's largest city, rents on two-bedroom apartments increased at a rate of 5.6 percent, significantly outpacing the growth rates for one-bedroom units (3.1 percent) and studios (3.2 percent).
- Elsewhere in the Midwest, rent increases on two-bedroom units also significantly exceeded those of studios and one-bedroom units in three Ohio cities: Toledo, OH (15.9 percent average increase), Cleveland (11.7 percent) and Columbus, OH (9.2 percent).
- Newark, NJ tops the list of communities where rents rose on one-bedroom apartments in 2018. A 17.5 percent hike brought average rentals in the New York City suburb to $1,962. That jump was exceeded by the percentage rise in Newark studio rents, which rose 18.7 percent to $1,366.
- Upward pressure on rents was seen in all other regions of the country, including the Midwest (Des Moines, IA; Fort Wayne, IN and Wichita, KS), the South (Louisville, KY) and the West (Anchorage, AK and Boise, ID).
- Three Phoenix suburbs also saw rent increases in the 12 percent range: Chandler, Scottsdale and Glendale.
Here's a more detailed look at the top 10 increases.
- New Orleans led the way with apartment-rent reductions for 2018 with an 11.4 percent drop on one-bedroom units to an average monthly rent of $1,418. The Crescent City logged even steeper reductions on two-bedroom rents, which fell 17.9 percent to a citywide average of $1,968.
- A 6.1 percent drop was seen on one-bedroom apartments in Jersey City, NJ – located just a dozen miles from Newark, NJ – the year's leader in rent increases.
- Declining rents were also seen in the Midwest (Madison, WI), the West (Portland, OR) and the South – particularly in the Texas cities of Corpus Christi, Houston and Fort Worth.
Here's a more detailed look at the top 10 decreases.
Apartment rents nationwide run a large gamut. The average trended upward for the year, with increases greater than 40 percent seen in some markets, while reductions in excess of 20 percent were noticed in other areas. For instance, average rents in 2018's lowest-priced rental city (Toledo, OH) were only 15 percent or less of those in the nation's costliest rental market (New York City).
Studios gain momentum
Nationwide, average studio-apartment rents rose in 80 of the 95 markets for which data is available. This was the steepest percentage increase seen in any unit-size category.
- The largest increase (40.6 percent) was in Arlington, TX where the studio average rent climbed to $951.
- Studio rent increases of 20 percent or more were also seen in:
- The largest drop (15.9 percent) was in Corpus Christi, TX where the studio average rent fell to $668.
- Henderson, NV also saw a reduction in excess of 10 percent, declining 10.6 percent to a city average of $1,008.
Demand for one- and two-bedroom units varies regionally
One-bedroom apartment rates increased in 81 of the top 100 markets.
- The largest increase (17.5 percent) was in Newark, NJ where the one-bedroom average rent climbed to $1,692.
- The largest drop (11.4 percent) was in New Orleans where the one-bedroom average rent fell to $1,418.
Rents on two-bedroom apartments increased in 71 of the top 100 markets.
- The largest increase (25.3 percent) was in Plano, TX where the two-bedroom average rent climbed to $1,808.
- Two-bedroom rent increases of 20 percent or more were also seen in:
- The largest drop (17.9 percent) was in New Orleans where the two-bedroom average rent fell to $1,968.
- Laredo, TX also saw a reduction in excess of 10 percent, declining 11.6 percent to a city average of $956.
The following summaries and observations can be taken away from the 2019 RentPath Annual Renter Report.
A likely contributor to the rising rents nationwide is a tightening in rental-property availability2
- For the third quarter of 2018, the last survey period available before the federal government shutdown halted updates to U.S. Census Bureau reports, the percentage of rental properties available declined to 7.1 percent compared to 7.5 percent for the same period in 2017.
- The quarterly rental-vacancy figure was statistically equivalent to the 6.8 percent rate seen in the second quarter of 2018, which followed two successive quarters (the first quarter of 2018 and the fourth quarter of 2017) in which the national year-over-year rental-vacancy rate was unchanged.
- Regionally, vacancy-rate percentages declined everywhere but in the Northeast, where the vacancy rate increased to 6.0 percent for the third quarter of 2018, up from 5.5 percent for the same period in 2017.
- In the Midwest, the rental vacancy rate dropped to 7.6 percent for the quarter, down from 8.1 percent a year earlier.
- The quarterly vacancy rate in the South fell to 8.7 percent, down from 9.4 percent in 2017.
- In the West, the rental vacancy rate declined to 5.1 percent, down from 5.8 percent in 2017.
There is some indication that the rate renters are grabbing up newly completed apartments is accelerating
- In the first quarter of 2018 (the most recent period for which data was available), the percentage of new units rented out within three months of coming on the market increased to a seasonally adjusted 56 percent, up slightly from 55 percent for the prior year. That marked the first increase in first-quarter absorption rate since 2013.3
- Two-bedroom units may be a good bargain for renters in many parts of the South, as demand for smaller units in the generally affordable region appears to be exerting upward pressure on studio-apartment rents and creating a corresponding downward push on rents for two-bedroom units.
Population trends continue to play a role in apartment pricing4
- Affordability in New Orleans, the city that saw the greatest drop in one-bedroom apartment rents, may be related to the city's continuing population decline. Following a brief post-Katrina gain in population from 2011, the Crescent City has seen net movement outward since 2014.
- Idaho's status as the state with the largest net population gain over three of the last four years has doubtless contributed to Boise's status as city with the fifth-largest increase in one-bedroom apartment rents (14.4 percent). Two-bedroom rents in family-oriented Boise grew at an even greater rate (20.2 percent).
- For more than a decade, Arizona has been a top-10 state for Americans choosing to relocate, and its status as the number two most popular state in 2018 (after Idaho), helps explain the presence of Chandler and Scottsdale on our list of cities with the largest hikes in rents on one-bedroom apartments.
- Latest Census estimates find the New York metropolitan area continuing to shed population as residents move to other U.S. cities. Relocation to Florida accounts for about 30 percent of the net movement, and roughly another third of the relocations are to other southern cities.
3 interesting takeaways
- A notable exception to the southern push for studios is Atlanta, where demand has pushed rents on two-bedroom apartments up 12 percent, while studio rents have crept up at just 2.9 percent, significantly less than the national average increase of 4.9 percent.
- Rents in the West region are rising at rates higher than the national average. Rents in the Bay Area (San Francisco, Oakland and San Jose) are exerting some of that pressure, with prices growing at a rate slightly above the national average. But the main drivers are rents in San Diego and suburbs of Phoenix (but not Phoenix itself), where rents have increased at rates of 12 to 16 percent.
- Apartment seekers in New York City's New Jersey suburbs may note that Newark is among the top 10 communities with rising rents for 2018 while neighboring Jersey City is among the towns with rents in deepest decline. That may signal a trend toward equalization of housing costs in both cities, but there's still a pretty long way to go before they reach parity. Other living costs are similar in both cities but average rents in Newark are about 66 percent of Jersey City's going rates.
Figures on rents and annual average changes for one-bedroom, two-bedroom and studio apartments in the nation's 100 most populous cities were compiled using multifamily rental property inventory from December 2017 to December 2018 on ApartmentGuide.com. Living expenses for featured cities are sourced from Cost of Living Index 2018 Third Quarter Data compiled by the Council for Community and Economic Research. Trend analysis was performed using data furnished by the U.S. Census Bureau, with specific sources cited at appropriate places in the text.
The rent information included in this article is used for illustrative purposes only. The data contained herein does not constitute financial advice or a pricing guarantee for any apartment.