Rental prices shot up during the pandemic. They are likely to remain high, with many Americans hesitant to purchase new homes amid soaring mortgage interest rates, according to the second-quarter report from national real estate brokerage HouseCanary.
The report analyzed single-family detached listings, which are standalone properties. Metro areas in California dominated the top spots for highest median rent, while those around the Sun Belt were most affordable.
More from Personal Finance:
Americans feel trapped in their homes by their low-rate mortgages
Retirement savings have increased substantially for high earners
Mega Millions jackpot hits $1.05 billion. How much the winner could owe in taxes
While annual inflation slowed to 3% in June, rent for primary residences was still squeezing many Americans at 8.3%, according to the U.S. Bureau of Labor Statistics.
5 U.S. metro areas with highest monthly rents
These U.S. metropolitan real estate markets had the highest median single-family monthly rents during the second quarter of 2023:
- Los Angeles; Long Beach, California; Anaheim, California: $4,984
- San Diego; Carlsbad, California: $4,862
- Naples, Florida; Immokalee, Florida; Marco Island, Florida: $4,821
- Bridgeport, Connecticut; Stamford, Connecticut; Norwalk, Connecticut: $4,750
- San Jose, California; Sunnyvale, California; Santa Clara, California: $4,629
5 U.S. metro areas with lowest monthly rents
These U.S. metropolitan real estate markets had the cheapest median single-family monthly rents during the second quarter of 2023:
- Little Rock, Arkansas; North Little Rock, Arkansas; Conway, Arkansas: $1,267
- Montgomery, Alabama: $1,394
- Birmingham, Alabama; Hoover, Alabama: $1,441
- Louisville, Kentucky; Jefferson County, Kentucky and Indiana: $1,492
- Cleveland, Ohio; Elyria, Ohio: $1,506
Beware of the ‘hidden’ costs of moving
Some 40% of Americans are eyeing a move at some point in 2023, according to a recent survey from moving website HireAHelper, and financial pressures are among the top reasons for relocating.
However, financial experts warn consumers about some of the unexpected expenses.
“Probably the most overlooked hidden cost is when you are looking for the next job,” said certified financial planner Michael Hansen, co-founder and managing partner of Frontier Wealth Strategies in Walnut Creek, California.
It may be appealing to move to a cheaper state to work remotely, but telecommuting may not be possible for your next role, he said. Before moving, you should consider your new city’s job market and possible in-person job opportunities.
“What you might save in dollars, you may lose in connection, collaboration and community,” said CFP Eric Roberge, who recently decided to move back to Boston after living in a lower-cost area.
“Although you can’t necessarily quantify that and put it in a spreadsheet the same way you can a budget with a rent or mortgage payment, being with your people is absolutely worth something,” said Roberge, founder of financial planning firm Beyond Your Hammock.