Realtor.com® May Rental Report: U.S. Rental Prices Reach the Highest Level in Two Years

Monthly rents rise 5.5% year-over-year to an average $1,527

- Rents in 38 of the 50 largest metros hit new peak prices, climbing at an average pace of 9.1% year-over-year, while declines softened in the biggest U.S. cities

- Smaller markets lead the national rebound, with Riverside, Calif., Memphis, Tenn., Tampa, Phoenix, and Sacramento, Calif. posting gains of 15% or higher over last year

- One-bedroom and two-bedroom units saw the highest prices in 27 months, and studio rents increased for the first time in 10 months

News provided by

Realtor.com

Jun 16, 2021, 06:00 ET

SANTA CLARA, Calif., June 16, 2021 /PRNewswire/ -- With vaccination rates rising and many U.S. businesses beginning to scale back their remote work policies, the U.S. median rental price hit the highest point in two years in May, surpassing pre-pandemic growth at an increase of 5.5% year-over-year, according to the Realtor.com^® Monthly Rental Report released today.

Nationally, the U.S. median rent was $1,527 per month in May. The median rent is now increasing faster than the 3.2% growth seen in March 2020 before the onset of COVID. In addition, one-bedroom and two-bedroom rentals reached new highs in May, while studio rents grew for the first time in ten months.

"Led by emerging tech markets and secondary cities, U.S. median rent prices reached the highest level seen in more than two years in May, surpassing pre-COVID levels. More than three-quarters of the 50 largest markets also hit this milestone, with rents climbing at an average pace of 9.1% year-over-year – nearly two-times the overall inflation rate of 5%," said Realtor.com^® Chief Economist Danielle Hale. "Highlighting COVID's uneven impact across the U.S., rents continued to decline in the nation's largest metros like Los Angeles and Boston, where May prices were below prior peaks. However, some big cities, San Jose, are making big strides toward recovery, with rents on pace to see new highs later this year."

Smaller tech cities and alternative suburbs lead the national rebound
In May, the U.S. median rent was up 7.5% over the same time in 2019, a more normal period for market comparison. Recent surges have helped erase the slower rent growth that has taken place since March 2020. In 38 of the 50 largest U.S. markets, May rents reached the highest level since March 2019. In these markets, rents were climbing at an average pace of 9.1% year-over-year in May.

Riverside, Calif., Memphis, Tenn., Tampa, Fla., Phoenix and Sacramento, Calif. posted gains of more than 15% year-over-year in May. The median rent in Riverside was, up 19.2% year-over-year to $2,020 – higher than the national rent, but a relatively affordable alternative to nearby Los Angeles where the median rent was $2,581.

One-bedroom and two-bedroom rents reach highest levels in two years
In May, one-bedroom and two-bedroom rents reached the highest levels since March 2019, at $1,422 and $1,718, respectively. With remote work driving the need for more space, two-bedroom rental prices continue to grow, rising an average of 8% year-over-year. Nationally, one-bedroom rents also saw sizable growth, up 5.8% year-over-year.

Studio rents saw their first positive growth (+1%) in 10 months, reaching a median rent price of $1,254. While studio rents have been experiencing declines throughout the pandemic, the May growth pace puts prices on track to reach a new milestone next month.

Big city rent declines soften year-over-year, shrinking the gap from pre-COVID peaks
Among the nation's 10 largest tech hubs, rent declines softened in May, declining just 2.3%, a significant improvement from the 6.6% decline seen earlier this year. Emerging tech hubs like Austin, Texas, and Denver continued to lead the rebound, with rents up 6.4% and 5.5% in May, respectively.

Rents remained below or at pre-COVID levels in some big cities that experienced significant pandemic-related disruption. Year-over-year rents were down 8.3% in San Francisco, 7.3% in San Jose and flat in New York. In these three markets, rents still need to grow an additional 9 to 12% to return to prior peak pricing.

With the gap shrinking between current and pre-COVID levels, price growth is beginning to return to more typical spring and summer seasonality – putting rents on track to reach new highs in the coming months.

May 2021 Rental Data - 50 Largest Metropolitan Areas

Metro	Median Monthly Rent	Rent YY
Atlanta-Sandy Springs-Roswell, Ga.	$1,536	13.2%
Austin-Round Rock, Texas	$1,421	5.3%
Baltimore-Columbia-Towson, Md.	$1,600	6.7%
Birmingham-Hoover, Ala.	$1,039	9.4%
Boston-Cambridge-Newton, Mass.-N.H.	$2,400	-3.8%
Buffalo-Cheektowaga-Niagara Falls, N.Y.	$1,144	2.1%
Charlotte-Concord-Gastonia, N.C.-S.C.	$1,400	10.7%
Chicago-Naperville-Elgin, Ill.-Ind.-Wis.	$1,650	-1.9%
Cincinnati, Ohio-Ky.-Ind.	$1,149	11.9%
Cleveland-Elyria, Ohio	$1,085	8.5%
Columbus, Ohio	$1,124	8.6%
Dallas-Fort Worth-Arlington, Texas	$1,339	7.2%
Denver-Aurora-Lakewood, Colo.	$1,755	6.4%
Detroit-Warren-Dearborn, Mich.	$1,159	6.3%
Hartford-West Hartford-East Hartford, Conn.	$1,500	6.4%
Houston-The Woodlands-Sugar Land, Texas	$1,250	4.3%
Indianapolis-Carmel-Anderson, Ind.	$1,093	9.7%
Jacksonville, Fla.	$1,260	9.6%
Kansas City, Mo.-Kan.	$1,109	4.6%
Las Vegas-Henderson-Paradise, Nev.	$1,340	12.2%
Los Angeles-Long Beach-Anaheim, Calif.	$2,581	-0.5%
Louisville/Jefferson County, Ky.-Ind.	$1,005	7.0%
Memphis, Tenn.-Miss.-Ark.	$1,092	17.2%
Miami-Fort Lauderdale-West Palm Beach, Fla.	$2,000	5.8%
Milwaukee-Waukesha-West Allis, Wis.	$1,355	0.4%
Minneapolis-St. Paul-Bloomington, Minn.-Wis.	$1,468	0.8%
Nashville-Davidson-Murfreesboro-Franklin, Tenn.	$1,390	5.5%
New Orleans-Metairie, La.	$1,350	8.0%
New York-Newark-Jersey City, N.Y.-N.J.-Pa.	$2,400	0.0%
Oklahoma City, Okla.	$834	5.6%
Orlando-Kissimmee-Sanford, Fla.	$1,444	9.0%
Philadelphia-Camden-Wilmington, Pa.-N.J.-Del-Md.	$1,600	3.2%
Phoenix-Mesa-Scottsdale, Ariz.	$1,543	16.8%
Pittsburgh, Pa.	$1,334	5.9%
Portland-Vancouver-Hillsboro, Ore.-Wash.	$1,595	6.7%
Providence-Warwick, R.I.-Mass.	$1,750	9.0%
Raleigh, N.C.	$1,318	9.9%
Richmond, Va.	$1,233	13.6%
Riverside-San Bernardino-Ontario, Calif.	$2,020	19.2%
Rochester, N.Y.	$1,200	9.1%
Sacramento-Roseville-Arden-Arcade, Calif.	$1,760	15.8%
San Antonio-New Braunfels, Texas	$1,105	5.7%
San Diego-Carlsbad, Calif.	$2,389	11.1%
San Francisco-Oakland-Hayward, Calif.	$2,715	-8.3%
San Jose-Sunnyvale-Santa Clara, Calif.	$2,795	-7.3%
Seattle-Tacoma-Bellevue, Wash.	$1,850	-2.6%
St. Louis, Mo.-Ill.	$1,145	9.6%
Tampa-St. Petersburg-Clearwater, Fla.	$1,520	16.9%
Virginia Beach-Norfolk-Newport News, Va.-N.C.	$1,272	9.8%
Washington-Arlington-Alexandria, D.C.-Va.-Md.-W.V.	$1,931	-1.1%

Methodology
Rental data as of May 2021. 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.

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