As home prices continue to rise, many prospective buyers are getting priced out and are forced to stay in the rental market longer. Which big cities still offer reasonable rental prices?
As the housing market has continued to recover since 2009, rental rates have been steadily rising. One of the main contributing factors is the dwindling supply of homes on the market as would-be sellers are electing to stay in their homes longer.
As home prices continue to rise, many prospective buyers are getting priced out and are forced to stay in the rental market longer. This in turn drives up rental prices and drives down vacancy rates. Consequently, rent as a percentage of income has increased to 29.2% in Q2 2017, up from the 1985-2000 historic rate of 25.8%.
In general, those in big cities have been affected the most, with average rental prices routinely topping $1,000/month for a 1 bedroom apartment. With that in mind, ConsumersAdvocate.org decided to see which big cities still offered reasonable rental prices.
To determine which U.S. cities had the cheapest rent, researchers at ConsumersAdvocate.org used data from the American Community Survey’s 2016 1-year estimates to see which cities with populations over 500k had the lowest median gross rent for a 1 bedroom apartment. The American Community Survey defines “median gross rent” as “as the rent contract plus the estimated average monthly cost of utilities and fuels.”