All
Members
Companies
Blog
Forums
Podcast
Webinars
    User Log in  /  Sign up
  • Forums
    Newest Posts Trending Discussions Followed Forums Real Estate News & Current Events General Landlording & Rental Properties Buying & Selling Real Estate Deal Analysis See All
  • Education

    Read

    BiggerPockets Blog BPInsights: Expert Analysis Coronavirus Content & Resources Guides Glossary Reviews Member Blogs

    Watch

    Webinars Video Library Financial Independence Blueprint Intro to Real Estate: Rentals

    Listen

    BiggerPockets Real Estate Podcast BiggerPockets Money Podcast BiggerPockets Business Podcast Real Estate Rookie Podcast Daily Podcast (Audio Blog)

    Topics

    Business Operations Finance Finding Deals Property Management Property Types Strategy
  • Network

    Recommended Vendors

    Real Estate Agents Mortgage Lenders Companies Hard Money Lenders Contractors Investment Companies

    Search

    Members Events Jobs
  • Tools

    Calculators

    Rental Property Fix and Flip BRRRR Rehab Estimator
    Wholesaling Mortgage Payment 70% Rule Airbnb

    Services

    BPInsights: Property Insights Tenant Screening Property Management Lease Agreement Packages

    New Feature

    BPInsights (beta)

    Quickly analyze a property address or ZIP Code to compare your rent in your neighborhood.

    Analyze a property
  • Find Deals
    Real Estate Listings Find Foreclosures External Link Ads, Jobs, and Other
  • Bookstore

    Real Estate Books

    Profit Like The Pros Bidding to Buy See all books

    Featured Book

    BiggerPockets Wealth Magazine book cover
    BiggerPockets Wealth Magazine

    Written by financial journalists and data scientists, get 60+ pages of newsworthy content, expert-driven advice, and data-backed research written in a clear way to help you navigate your tough investment decisions in an ever-changing financial climate! Subscribe today and get the Oct/Nov issue delivered to your door!

    Get the Magazine
  • Pricing
Log In Sign up
User
Quick search links
Podcast Hard Money Lenders Books New York
BlogArrowReal Estate News & CommentaryArrowThe 10 US Markets With the Biggest Rent Increases & Decreases in 2015
Real Estate News & Commentary

The 10 US Markets With the Biggest Rent Increases & Decreases in 2015

Allison Leung
Expertise: Personal Development, Real Estate News & Commentary
40 Articles Written
rental-markets-2015

In a study released today on rent affordability, RealtyTrac found that, assuming a 3 percent down payment, buying a home is more affordable than renting in 58 percent of US housing markets. Still, home price appreciation continued to outpace rent growth in 55 percent of the markets, and rent growth continued to outpace weekly wage growth in 57 percent of markets.

Want more articles like this?

Create an account today to get BiggerPocket's best blog articles delivered to your inbox

Sign up for free

“Renters in 2016 will be caught between a bit of a rock and a hard place, with rents becoming less affordable as they rise faster than wages, but home prices rising even faster than rents,” commented RealtyTrac VP Daren Blomquist. “In markets where home prices are still relatively affordable, 2016 may be a good time for some renters to take the plunge into homeownership before rising prices and possibly rising interest rates make it increasingly tougher to afford to buy a home.”

Related: BiggerPockets Real Estate Investment Market Index: The Best (and Worst) Major Markets for Real Estate Investors, 2015

Markets With the Biggest Increases & Decreases in Rents

In the 504 counties studied, the following was discovered:

  • Three-bedroom property rents are likely to increase an average of 3.5 percent in 2016 compared to 2015 across all markets, according to HUD data
  • Weekly wages in Q2 of 2015 were up an average of 2.6 percent from a year ago
  • Median home prices were up an average of 5.0 percent in Q3 of 2015 compared to a year ago

Markets with the biggest increases in rents include:

  • Sumter, South Carolina
  • Burlington, North Carolina
  • Goldsboro, North Carolina
  • Houma-Thibodaux, Louisiana
  • Missoula, Montana

The biggest increases among counties with populations of one million or more include:

  • Santa Clara County, California in the San Jose metro area (up 9.3 percent)
  • Travis County, Texas in the Austin metro area (up 8.0 percent)
  • San Diego County, California (up 7.5 percent)
  • Cook County, Illinois in the Chicago metro area (up 7.3 percent)
  • Bexar County, Texas in the San Antonio metro area (up 7.2 percent)

The markets that saw the biggest decrease in rents include:

  • Johnson City, Tennessee
  • Abilene, Texas
  • California-Lexington Park, Maryland
  • Ithaca, New York
  • Roseburg, Oregon

Counties with a population of one million or more with the biggest decreases are:

  • Suffolk and Nassau counties in Long Island, New York (both down 6.8 percent)
  • Clark County, Nevada in the Las Vegas metro area (down 1.4 percent)
  • Sacramento County, California (down 0.4 percent)
  • Contra Costa County, California in the San Francisco metro area (down 0.3 percent)

The Most & Least Affordable Markets for Renters

Across the US markets examined, the study found that wage earners on average will likely need to shell out 37 percent of their income on rents for a three-bedroom home in 2016. The price to buy a home — again, assuming a 3 percent down payment and including mortgage, taxes, insurance and mortgage insurance — for a median priced property would require just more than that, at 38 percent of income. Overall, 213 of the 504 counties studied (42 percent) saw higher affordability of renting over buying, while in 291 counties (58 percent), it was more affordable to buy.

Related: House Flipping Up 18% Over Last Year: Here Are the Top-Performing Markets

The markets that are likely to require the highest percentage of income to be spent on rent (more than 60 percent of average wages) in 2016 include:

  • Honolulu
  • Washington, DC
  • New York City
  • Northern California metros of Salinas, Santa Cruz and San Francisco

Conversely, those markets that are projected to require the smallest percentage of income (less than 25 percent of average wages) are:

  • Huntsville, Alabama
  • Peoria, Illinois
  • Davenport, Iowa
  • Atlanta, Georgia
  • Pittsburgh, Pennsylvania

Most & Least Affordable Millennial Rental Markets for 2016

RealtyTrac’s study also took a look at “millennial magnet” markets, those where the millennial share of the population increased at least 10 percent from 2008 to 2013. The findings were as follows:

Via: RealtyTrac

Via: RealtyTrac

Via: RealtyTrac

Via: RealtyTrac

What Does This Mean for Investors?

As rents continue to rise, landlords should be able to find good returns in many markets; however, they’ll have to contend with unaffordable property prices that may continue to escalate in 2016. Whether the millennial population, which has been notoriously slow to jump on the homeownership band wagon, will take the plunge and begin to buy property this coming year or continue to rent is yet to be seen.

Wondering what the projected stats look like for your specific market? Be sure to check out this interactive map to see what 2016 has in store for the rental and buying markets in your area.

What have you seen as far as rent and home prices in 2015 in YOUR market? What do you think will happen in 2016?

Leave a comment!

By Allison Leung
A career writer, editor and blogger, Allison serves as the Director of Content for BiggerPockets.com. In the past, she has channeled her passion and curiosity for all things real estate into her jobs by working in real estate law and heading a blog about real estate market trends. Don’t ask about her dog, Ace, unless you want to see approximately 500 photos of his (adorable) face.
Read more
13 Replies
    Brock Adams from Chapin, South Carolina
    Replied about 5 years ago
    Good Read. My area of South Carolina seems to be more about job/wage opportunity and although most might agree that owning is better in some cases than renting, there is a growing number of tenants I come across who do not want to be tied down with home ownership or the repairs/maintenance that go with it. There is a big psychological aspect to the first time home buyers of today. Some would prefer to save their money for cars, leisure and travel. Some have cleaned up their credit over the last 3 years and are now trying to get a loans however underwriting loans is a different world and banks call the shots. Also, some of the inventory for starter homes has been sucked up by investors and the other inventory is from sellers who are not moving out or up in size of homes and are parked for the time being. Our local builders are opting to build the more expensive homes at prime locations.

    Report Abuse

    Why are you reporting this?

    Additional Comments (optional)

    Cancel
    Michael Boyer Investor from Juneau, AK
    Replied about 5 years ago
    Interesting info.. Also, surprised not too much impact yet with lower oil prices (save Abilene) on the list, but could be in the cards for 2016 in energy economies that make the list (e.g., places in TX, OK, LA, ND, AK, etc)….

    Report Abuse

    Why are you reporting this?

    Additional Comments (optional)

    Cancel
    Justin Pierce Rental Property Investor from Woodbridge, VA
    Replied about 5 years ago
    Very good piece, Allison.

    Report Abuse

    Why are you reporting this?

    Additional Comments (optional)

    Cancel
    David Oldenburg Flipper/Rehabber from Granite Bay, CA
    Replied about 5 years ago
    It’s interesting to see that Sacramento rents actually went down slightly over the last year, because the rental market here is very strong with everyone complaining about rising rents! Interesting also is the number of markets that still cash-flow, with house payments the same or less than rent.
    Deanna Opgenort Rental Property Investor from San Diego, CA
    Replied about 5 years ago
    Worth noting that different sectors of the rental market don’t all do the same thing. From what I can tell, at least in San Diego the lower rent areas have gone up even more (maybe 25% in 2 years). Some of it is “gentrification” – run-down places bought by investors, fixed (sometimes real improvements, sometimes just window-dressing) then rent raised. Great to live in a nicer place, but rent going from $900 to $1200 for a few new shrubs outside is a disaster for anyone on a fixed budget. $1200/mos is the going rate for a decent 2 bedroom apt in the sketchy, druggie parts of town. $2,500 for an older 2 bedroom house in a nicer part of town. $3500 for a 3-4 bedroom SFR in the nicer parts of town (Expensive areas are $5-7k for a 3-4 bed, but that’ll be a really nice house).

    Report Abuse

    Why are you reporting this?

    Additional Comments (optional)

    Cancel
    Doreen Silva
    Replied about 5 years ago
    I thought the same; my rent increased and there are hardly any amenities here, severe parking issues, single pane windows, etc. It’s not a run down area, but the complex could definitely benefit from remodeling/restructuring. People are moving out in droves, to more economically built modern units, with more amenities. If you’re going to pay more, you expect more

    Report Abuse

    Why are you reporting this?

    Additional Comments (optional)

    Cancel

    Report Abuse

    Why are you reporting this?

    Additional Comments (optional)

    Cancel
    David Cohen
    Replied about 5 years ago
    Really? New York, New York is one of the most affordable rental cities? More-so than Queens?

    Report Abuse

    Why are you reporting this?

    Additional Comments (optional)

    Cancel
    Mary B. Real Estate Investor from Lansdowne, Pennsylvania
    Replied about 5 years ago
    @Brock Adams Wait, how could D.C. & NY,NY be both the most affordable rental markets in 2016 as well as be “The markets that are likely to require the highest percentage of income to be spent on rent (more than 60 percent of average wages) in 2016”?? If rent is eating up say 85% or more of your income then that’s not considered ‘most affordable’ in the least. Missing anything? Kudos, Mary
    Derek Carroll Syndicator and Fund Manager from Victor, NY
    Replied about 5 years ago
    note that its an affordable “millennial’ market. it’s very likely that these numbers consider the fact that a larger number of younger people in NYC are sharing an apartment with 2-3 other people.

    Report Abuse

    Why are you reporting this?

    Additional Comments (optional)

    Cancel

    Report Abuse

    Why are you reporting this?

    Additional Comments (optional)

    Cancel
    Mary B. Real Estate Investor from Lansdowne, Pennsylvania
    Replied about 5 years ago
    Oh, I’m sorry I meant to address the originator, thinking Brock was at the bottom of the blog. I somehow skipped over Allison. @Allison Leung the above question was geared to you, my mistake. If you don’t mind sharing the source of these findings, it would be most appreciated.

    Report Abuse

    Why are you reporting this?

    Additional Comments (optional)

    Cancel
    Don Alberts from Frankfort, Illinois
    Replied about 5 years ago
    Thanks for the information. I will use this in considering areas to invest in. Don

    Report Abuse

    Why are you reporting this?

    Additional Comments (optional)

    Cancel
    Cashmere Robinson Wholesaler from Bronx, New York
    Replied about 5 years ago
    Good piece of information. Very interested to know about the Bronx area, where do we stand right now. As we are working in this zone, data shared is much appreciated.

    Report Abuse

    Why are you reporting this?

    Additional Comments (optional)

    Cancel
    Account Closed from Los Angeles, CA
    Replied about 5 years ago
    Thank you for this information! Would like to know the source and how was the data accumulated? Thank you very much!

    Report Abuse

    Why are you reporting this?

    Additional Comments (optional)

    Cancel
Rotate Log in or sign up to comment

Related Blog Posts

Real Estate News & Commentary Jan 13, 2021

14 Markets Where Home Flippers Are Doubling Their Money

By BiggerPockets

Fix and flip profits shot up in late 2020 amid low inventory, heavy buyer competition, and record-low interest rates, recent data revealed.

Read more →

Real Estate News & Commentary Jan 11, 2021

The 5 Best Places to Raise a Family in the U.S.

By BiggerPockets

MoneyRates compared all 50 states, ranking each in categories such as cost of living, daycare availability, college affordability, and more.

Read more →

Real Estate News & Commentary Jan 08, 2021

Survey Says: These Are the Best & Worst Investments for 2021

By BiggerPockets

Sophisticated Investor polled 5,001 people about which investments will perform best. Find out what we’re betting on, broken down by age and gender.

Read more →

Real Estate News & Commentary Jan 06, 2021

Top 5 Markets Where Buyers Are Facing Bidding Wars (& Where Competition Is Much Less Fierce)

By BiggerPockets

Around 54% of aspiring homebuyers who submitted offers faced competition in November, Redfin data show. That marks seven straight months where at least half of all offers were contested. 

Read more →
Log in Sign up

Log in

Forgot password?

If you signed up for BiggerPockets via Facebook, you can log in with just one click!

Log in with Facebook

Or
btn_google_dark_normal_ios Created with Sketch. Continue with Google

Let's get started

We just need a few details to get you set up and ready to go!

Use your real name

Use at least 8 characters. Using a phrase of random words (like: paper Dog team blue) is secure and easy to remember.

By signing up, you indicate that you agree to the BiggerPockets Terms & Conditions.

Or
btn_google_dark_normal_ios Created with Sketch. Continue with Google

Why create an account?

Receive a free digital download of The Ultimate Beginner's Guide to Real Estate Investing.

Connect with 1,000,000+ real estate investors!

Find local real estate meetups and events in your area.

Start analyzing real estate properties, we do the math for you.

It's free!

Explore

  • Membership
  • Community
  • Education
  • Marketplace
  • Tools
  • FilePlace
  • REI Resources
  • Perks
  • Glossary
  • Reviews
  • iOS App
  • Android App

Company

  • About Us
  • Press
  • Advertising
  • Careers
  • Stats
  • Contact Us

Important

  • Editorial Guidelines
  • Terms of Use
  • Rules
  • Privacy
  • FAQ

Social

  • Facebook
  • Twitter
  • YouTube
  • Instagram
© 2004-2021 BiggerPockets, LLC. All Rights Reserved.