WPB Rents Spike 36 Percent Annually in October, National Rents Up 13 Percent
According to real estate brokerage firm Redfin, national median monthly mortgage payment for homebuyers posted even bigger growth, climbing 17% since October 2020.
The 3.2% month-over-month increase in mortgage payments for homebuyers was the largest since April, and more than double the increase during the same period in 2019. Growth rates for mortgage payments and rents had been converging, but an uptick in mortgage rates and home prices caused mortgage-payment growth to accelerate from September to October. The 0.4% month-over-month increase in rents was the smallest in eight months, which could just be a seasonal slowdown or may signal some potential relief for renters.
Rent price increases outpaced mortgage payments for new homebuyers in 29 of the 50 largest metro areas in the U.S. during October.
Rents are Up Over 30% In Many Major Metro Areas
The metro areas with the biggest increases in rent prices--up over 30%--were in Florida, Washington State, Oregon, Texas, and New York.
"Fast-rising rents could contribute to inflation woes," said Redfin Chief Economist Daryl Fairweather. "Employees facing higher rents are likely to demand higher compensation from their employers, which could in turn lead to even more inflation down the line. Skyrocketing rents in some of the most desirable cities suggest that there is an overall shortage of homes, and not just of homes for sale. The 'Build Back Better' bill that is currently being debated by Congress contains $150 billion in spending earmarked for affordable housing, which could at least begin to address the issue, but the bottom line is that a lot more housing needs to be built in the places that are growing the most."
Top 10 Metro Areas With Fastest-Rising Rents
1. West Palm Beach, FL (36%)
2. Fort Lauderdale, FL (36%)
3. Miami, FL (36%)
4. Seattle, WA (32%)
5. Jacksonville, FL (32%)
6. Portland, OR (31%)
7. Austin, TX (31%)
8. Newark, NJ (31%)
9. Nassau County, NY (31%)
10. New York, NY (31%)
Only St. Louis saw rents decline at (-4%). St. Louis also was the only metro to see a decrease in rent in October compared to a year earlier.
Only 15 of the 50 largest metro areas saw rents rise more slowly than the 13% national average, including Chicago (+11%), Pittsburgh (+7%) and San Francisco (+7%).