Rents in some cities in the South and Midwest are rising faster than the national average, driven by the migration of residents to the East and West Coasts in search of more affordable housing.
Rents in cities like Raleigh, North Carolina, and Indianapolis, Indiana, increased by more than 15% in November compared to a year earlier, according to a new report from Rent.com. Data shows that nationally, rents have gone up by an average of 7.4%.
According to migration data from moving company PODS, Americans are leaving major cities in New York and California and relocating to mid-sized cities in the South. The median rent is $4,100 per month in the New York City area and $3,415 in Los Angeles, compared to $1,500 per month in Indianapolis and $2,100 in Raleigh.
“We can tell that, in general, renters are leaving the Northeast and they’re leaving the West for places in the Midwest and South,” Rent.com researcher John Leckie told CBS MoneyWatch. “It has price linkages. When you have an increase in demand, it’s going to drive up your prices.”
Leckie said rental demand is also rising partly due to a trend in the home buying market. In some areas, home seekers scared of rising mortgage rates have decided to rent for now in the hope that home prices will drop further. Lecky said people who sold their homes this year and chose not to buy another home are also occupying rental units.
According to Rent.com, here are the cities where rents have seen the biggest jump from November 2021 to November 2022 along with the average rent.
Rent.com has also listed the cities where rents have declined the most over the last year.
The median rent around the US rose to $2,007 per month in November from $1,983 the previous month, Rent.com said.
Rent.com said those costs are likely to rise in the coming months, but should eventually level off or even fall by mid-2023.