Apartment rents in Oklahoma City, Oklahoma, and Austin, Texas, over the last year have soared more than 100%, reflecting a broader surge in the cost of housing.Yet in a handful of U.S.cities that are bucking the trend, rental costs are actually falling.
As of April, rents had dropped almost 12% from a year ago for one-bedroom units in Baltimore, Maryland, and Cleveland, Ohio, according to a new study from Rent.com.During that same period, prices also fell about 11% in Toledo, Ohio; 10% in Kansas City, Missouri, and Milwaukee, Wisconsin; and more than 9% in Indianapolis, Indiana.
Other cities where rents for one-bedrooms have fallen significantly from last year include Las Vegas, Nevada; Virginia Beach, Virginia; Lubbock, Texas; and Norfolk, Virginia, Rent.com found.
Prices for two-bedroom units have fallen year-over-year in Shreveport, Louisiana; Wichita, Kansas; and Scottsdale, Arizona.
Major rents in those areas are falling as Americans are being called back to the office in major metropolitan areas — and that’s lowering demand for housing in midsize towns, said Brian Carberry, senior managing editor at Rent.com.
“People are moving out of these areas and moving back to Chicago, L.A., New York, Seattle or wherever they’ve moved from,” he told CBS MoneyWatch.
That same trend helps explain why rents are continuing to skyrocket in places like Miami, Atlanta, San Diego and other urban hotspots.
In these cities, the available housing stock simply isn’t keeping up with demand, Carberry said.And while construction companies are building new apartment complexes in some areas, most consist of high-priced, luxury units.
Another reason rents are jumping in larger cities is that many families who sold their homes in recent years are joining the rental market as the cost of buying a place and mortgage rates jump.
“People who have sold their home are finding that it’s better for them, long-term, to rent — rather than buy right away and give that profit right back to another home seller,” Carberry said.
Rents began falling in large cities during the early months of the COVID-19 pandemic as some people fled to smaller metro areas.Now that most pandemic restrictions have lifted, Americans are returning to larger cities en masse and looking for apartment space, thus driving prices higher.
Rent prices have been particularly higher in Florida and New York.
The median monthly rent for Miami rose to $2,988 in March, according to Realtor.com, putting it on par with California’s notoriously pricey Bay Area and above the $2,750 median in New York City.Median rents in Orlando and Tampa were $1,886 and $2,114, respectively.
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Brooks is a reporter for CBS MoneyWatch covering business, consumer and financial stories that range from economic inequality and housing issues to bankruptcies and the business of sports.
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