money States where rent increased the most in 2019
Renters got some relief in 2019, with prices nationwide barely inching higher or not budging at all, depending on the size of the rental.
The median one-bedroom rent in the U.S. was $1,444 in 2019, according to the latest data available from Zillow, up 0.63% from $1,435 in 2018. The median two-bedroom rent was $1,599, nearly unchanged from $1,600 the previous year.
But not all markets remained so affordable. Rents in some states grew many times the national average, according to the Zillow data, and the trend could continue into 2020.
“We expect rents to slow down, since they have been accelerating since June,” said Joshua Clark, economist at Zillow, “but only by a couple of points.”
Here’s where rental prices for one- and two-bedroom apartments increased the most in 2019.
Hottest states for one-bedroom rentals
No. 1: Idaho (+6.1%)
Demand from Boise, the state’s capital, helped to drive the median rental price to $1,002 in 2019, up 6.1% over 2018, and the sharpest increase in the country.
“In Idaho we saw a continued increase in rents starting last year,” said Victor Calanog, head of commercial real estate economics at Moody’s Analytics. “In Boise, you’re looking at higher than U.S. average job growth and unemployment there is at 2%.”
Rent likely will continue to increase in the state. The population growth in the region where Boise is located is projected to grow 16.5% to over 890,000 from 2016 to 2026, according to the state’s website.
No. 2: Nevada (+5.7%)
Experts say Las Vegas has previously been a driving force for a strong rental market, but other reasons – such as warm weather – may also be playing a role this year. The median rent is at $1,073 for a single-bedroom apartment.
“I feel with a southern state like Nevada, that’s probably more to do with people moving there for climate on a larger demographic shift,” said Constantine Valhouli, director of research at NeighborhoodX, a real estate and analytics firm.
No. 3: South Carolina (+5.3%)
South Carolina, known for its rich architecture – especially in the historic city of Charleston – takes the top three spot. While its median rent is higher than rent in both Idaho and Nevada at $1,086, its year-over-year growth was slightly less.
“Charleston has been under the radar for so long,” Valhouli said. “It’s inherently desirable with its architecture.”
No. 4: Massachusetts (+4.6%)
Median rent in Massachusetts is the highest of the top five in the one-bedroom list at $1,901. That largely reflects its robust job market where the unemployment rate is 2.9%, lower than the national average of 3.7%.
“Massachusetts has been really good in general due to employment,” Valhouli said. “That’s why it’s much more expensive. It’s lucrative and better for one’s career.”
No. 5: Wisconsin (+4.0%)
While the median rent in Wisconsin is $888, the lowest amount on the top five list for one-bedrooms, it increased 4% from $852 in 2019.
Hottest states for two-bedroom rentals
No. 1: Idaho (+7.2%)
Idaho also saw the fastest rental growth among two-bedroom apartments in the U.S. Known for farming and mining, the state has recently become a hotbed for tech companies such as Micron Technology, the memory chip maker.
“Idaho is the fastest growing state in the nation in terms of population,” Calaong said. “The economy is also definitely stronger since tech companies are becoming increasingly important in Boise.”
The median rent for a two-bedroom is $1120, up from $1,044 in 2018.
No. 2: Arizona (+5.6%)
Arizona’s median rent of $1,269 saw the second-fastest year-over-year growth in 2019.
One reason for the increase is the influx of California residents, who are escaping even higher rental prices by moving south. From 2007 to 2016, Arizona lured the second-most California residents after Texas, according to recent migration data.
“I think the big problem is affordability. That’s not going away,” Clark said. “You see these trends of people leaving California and moving to cheaper parts of Arizona.”
No. 3: Nevada (+3.7%)
Nevada’s median rent of $1,278 is higher than that of Idaho and Arizona, but grew at a slower year-over-year pace.
Similar to Arizona, Nevada is benefiting from the migration of California residents in the past 10 years. It is the third most popular state destination for former Californians.
No. 4: North Carolina (+3.2%)
North Carolina’s median two-bedroom rent stands at $1,114, the lowest of the top five, but a 3.2% increase over $1,079 in 2018.
The state has benefited from rapid population and employment growth, especially in its urban centers. Since 2010, the population increased by 850,000, while private employment expanded by 30% in large, urban counties between 2000 and 2018.
No. 5: Maine (+2.9%)
Maine takes the top five position for hottest two-bedroom rental market. It currently has a median rent of $1,412, a 2.9% increase over 2018, thanks to its population growth.
“The spike in rent prices show that there has been an increased demand for apartments with stock unable to keep up just yet,” said Anthemos Georgiades, CEO of rental listing site Zumper.com. “Until housing is built, prices will likely remain steadily growing.”
Dhara is a writer for Yahoo Finance. Follow her on Twitter @dsinghx.
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