September Rent Report: Urban Tech Hubs Cooling, Outlying Secondary Markets Heating Up

36 of the 100 largest counties are seeing rents decline compared to last year.

Highlights

  • In the 100 largest counties, the median rent for Studio units was $1,347, down 0.5% year-over-year; One-bedroom units $1,502, up 1.0% year-over-year; Two-bedroom units $1,873, up 2.3% year-over-year
  • In September, One-bedroom rents were declining year-over-year in 36 of the 100 largest counties, up from just 6 in March. Two-bedroom rents were declining year-over-year in 25 of the 100 largest counties, up from just 12 in March.
  • High-tech hubs and pricey markets in the bay area — San Francisco, San Mateo, and Santa Clara counties — are seeing the largest declines in rents across the board, along with Manhattan, Boston, Seattle, and Washington, D.C. 
  • Fast-growing cities (e.g. Rochester, NY; Colorado Springs, CO) and spillover markets (e.g. Tacoma, WA) are seeing the largest increases in rents compared to last year.

September 2020 rental data reveals that rents across the nation’s largest 100 counties are losing momentum, with year-over-year trends easing since March across Studio, One-bedroom, and Two-bedroom units. In several major cities, rents are down substantially compared to last year.

In September, One-bedroom rents were declining year-over-year in 36 of the 100 largest counties, up from just 6 in March. Two-bedroom rents were declining year-over-year in 25 of the 100 largest counties, up from just 12 in March.

Rents at the national level, calculated by averaging the top 100 counties, are cooling.

The median Studio rent in September was $1,347, down 0.5 percent year-over-year. In March, studio rents were growing by 5.5 percent year-over-year. Since April, all six months each showed slowdowns in Studio rent growth from the previous month. The trend has been consistently downward.

The median One-bedroom rent in September was $1,502, up 1.0 percent  year-over-year. In March, One-bedroom rents were growing by 3.7 percent year-over-year. Since April, five of the six months showed slowdowns in One-bedroom rent growth from the previous month.

The median Two-bedroom rent in September was $1,873, up 2.3 percent year-over-year. In March, Two-bedroom rents were growing by 3.5 percent year-over-year. Since April, four of the six months showed slowdowns in Two-bedroom rent growth from the previous month.

Urban, high-priced areas are seeing largest dips in rents compared to last year

As renters continue adapting to the pandemic, many are seeking more affordable housing, job opportunities, and are perhaps opting for less-crowded neighborhoods. Urban centers such as the Bay Area, Manhattan, Boston, Seattle, and Washington, D.C all saw the largest declines in rents compared to last year. These markets also represent some of the most expensive cities in the country, giving rents the most room to fall. 

New York and other northeastern cities experienced substantial early impacts of the COVID-19 pandemic, leading to many residents seeking housing outside of the crowded centers.  In September, the median Studio rent in Manhattan was $2,495, down 15.4 percent year-over-year. One-bedroom rents were $3,400, down 11.7 percent compared to last year.

On the west coast, tech workers in San Francisco and throughout the Bay Area–some of the most expensive rental markets in the country–were afforded the opportunity to work remotely, thereby bypassing the need for housing near their work. That freed them up to seek rentals in more affordable areas. San Francisco topped the list of rent declines in all three unit types, with Studio rents declining by 31 percent, One-bedrooms by 24.2 percent, and Two-bedrooms by 21.3 percent.

Hot housing locales and spillover markets are see the largest increases in rent

Places like Monroe County, NY (Rochester) and El Paso County, CO (Colorado Springs) have been hot on the homebuying front for a while, and it’s no different on the rental side. The demand in these fast-growing markets is reflected in the growing rental prices.

Monroe County, NY topped the list of fastest-growing rents for One-bedroom units, with the median rent at $1,049 in September, up 12.8 year-over-year.

The presence of counties like Bronx, NY; Pierce, WA (Tacoma); Essex, NJ (Newark); and Worcester, MA shows the growing demand for housing just beyond the nearby major cities. This transition is likely in part to both affordability and a response to COVID-19, as more people seek out less crowded environments. Renting in these spillover markets provides lower rents, more social distancing, and still allows for commuting if necessary.


Studio

Top 10 Markets for Studio Rent Decreases

Rank County Median Rent YoY Percent Change
1 San Francisco, CA $2,285 -31.0%
2 Wayne, MI $886 -23.0%
3 Santa Clara, CA $2,016 -19.2%
4 San Mateo, CA $2,100 -17.6%
5 New York, NY $2,495 -15.4%
6 Honolulu, HI $1,400 -14.9%
7 Allegheny, PA $1,018 -14.9%
8 Middlesex, MA $2,066 -14.8%
9 King, WA $1,490 -12.1%
10 Alameda, CA $2,153 -12.1%

 

Top 10 Markets for Studio Rent Increases

Rank County Median Rent YoY Percent Change
1 Tulsa, OK $755 36.0%
2 Hillsborough, FL $1,245 28.4%
3 Montgomery, PA $1,300 20.0%
4 Essex, NJ $1,615 19.2%
5 Pima, AZ $687 18.5%
6 Sacramento, CA $1,400 16.2%
7 Broward, FL $1,535 13.9%
8 Bexar, TX $941 13.4%
9 Baltimore, MD $944 11.3%
10 Cuyahoga, OH $775 11.2%

One-bedroom

Top 10 Markets for One-bedroom Rent Decreases

Rank County Median Rent YoY Percent Change
1 San Francisco, CA $2,873 -24.2%
2 San Mateo, CA $2,598 -12.5%
3 Santa Clara, CA $2,466 -12.0%
4 Suffolk, MA $2,650 -12.0%
5 New York, NY $3,400 -11.7%
6 King, WA $1,830 -10.7%
7 Honolulu, HI $1,750 -10.3%
8 District of Columbia, DC $2,174 -8.1%
9 Fairfax, VA $1,663 -7.9%
10 Middlesex, MA $2,300 -7.3%

 

Top 10 Markets for One-bedroom Rent Increases

Rank County Median Rent YoY Percent Change
1 Monroe, NY $1,049 12.8%
2 Marion, IN $940 12.4%
3 Wayne, MI $1,125 11.5%
4 Pinellas, FL $1,275 11.0%
5 Sacramento, CA $1,415 10.1%
6 Baltimore, MD $1,210 10.0%
7 Bronx, NY $1,900 9.4%
8 Gwinnett, GA $1,149 8.4%
9 Pierce, WA $1,370 8.3%
10 Worcester, MA $1,650 8.2%

 


Two-bedroom

Top 10 Markets for Two-bedroom Rent Decreases

Rank County Median Rent YoY Percent Change
1 San Francisco, CA $3,931 -21.3%
2 San Mateo, CA $3,380 -11.1%
3 Santa Clara, CA $3,075 -9.2%
4 Suffolk, MA $3,405 -8.1%
5 Middlesex, MA $2,790 -7.0%
6 Denver, CO $2,177 -6.0%
7 District of Columbia, DC $3,075 -5.8%
8 Erie, NY $1,188 -5.4%
9 Dallas, TX $1,510 -5.3%
10 Milwaukee, WI $1,575 -5.3%

 

Top 10 Markets for Two-bedroom Rent Increases

Rank County Median Rent YoY Percent Change
1 Hamilton, OH $1,299 16.0%
2 Wayne, MI $1,300 13.0%
3 Essex, NJ $2,400 12.6%
4 Pinellas, FL $1,690 10.5%
5 El Paso, CO $1,395 10.4%
6 Lee, FL $2,200 10.0%
7 Cuyahoga, OH $1,200 9.6%
8 Marion, IN $1,045 9.5%
9 Pima, AZ $1,121 9.4%
10 Monroe, NY $1,250 8.7%

Methodology

Rental data as of September 2020. Rental units include apartment communities as well as private rentals (condos, townhomes, single-family homes). National rents were calculated by averaging the medians of the 100 largest counties, except for Studios, which were based on 80 of those counties with at least 20 listings.

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