US rental rates surged to record heights in June when the average rose by 2.9% in the year. Upticks were considerably higher in many small and large cities, particularly in states experiencing strong population and economic growth. Florida is a case in point with three of its metro areas experiencing sharp hikes in rental rates.
The latest survey on US rental rates published by RentCafé for June this year finds that almost without exception rents are rising throughout the country. Of the 250 largest cities included in the survey, 88% saw increases in rental rates. In contrast, rates fell in just 2% of metro areas.
Highest ever rate
The monthly average of US$1,405 in June comes in as the highest on record and translates to a 2.9% rise in the year. This means that tenants are currently paying more than US$40 a month more than they were in June last year. US rental rates rose by 0.9% in June alone.
RentCafé points out that the twin tandem of population migration and strong economic growth is the main factor behind burgeoning rental rates in many US cities. In fact, the top 20 fastest-growing rates are found in small cities driven by new residents migrating to the city drawn to a growing economy.
Florida rental rates have highest grow
Some of the highest increases in US rental rates are found in Florida, currently one of the fastest growing states in the country. The Sunshine State has a rapidly growing population and is registering increases in GDP and job opportunities well ahead of the rest of the US.
According to RentCafé, Orlando tops the table for the highest proportional increase in rental rates. The metro area saw them go up by 8.4% in the year to an average of US$1,387.
Tampa properties also ranked on the list for fastest-growing rental rates in mid-size cities. In the year to June, rentals in Tampa went up by 6.2% to reach an average of US$1,278. RentCafé attributes this to the Tampa Bay economy “on the upswing for a couple of years now, in large part due to a business-friendly environment and a very low cost of living”. Rental rates in this part of Florida are “slowly but steadily catching up with South Florida prices,” says the survey.
Rental properties in Jacksonville too saw a sharp increase in rates in June. The city passed the US$1,000 average during the month for the first time ever to reach US$1,034, the result of the 4.8% surge in rental rates.