Over the past several years, renting an apartment in some parts of the country has become just as competitive (if not more) than buying a house. Some telltale signs that you’re in a cutthroat rental market include open houses to look at rentals, bidding wars with some renters offering to pay more than the asking monthly rent in order to ink a lease, and apartments that fly off the market as soon as they’re advertised.
More than one-third of U.S. households rent, according to the U.S. Census Bureau, and many are seeing sharp increases in living costs.
Average rental costs are 29% higher than they were before the pandemic, according to the latest report from Zillow. In 47 of the 50 biggest metros, the cost of rent is up from the previous year.
Lack of inventory is to blame for keeping rental rates high in many areas, says Nicole Beauchamp, associate broker with Sotheby’s International Realty, who works with tenants and landlords in Manhattan and Brooklyn, New York, two highly competitive markets.
The rental market is also flooded with would-be buyers who are waiting for interest rates to come down before they get serious about house hunting. Currently, interest rates are over 7% on 30-year, fixed-rate loans, the most popular mortgage product, though the Feds have indicated they’ll cut rates at some point in 2024, which could help spell relief for renters, as it should help free up some inventory.
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Beauchamp’s best advice? Be fully prepared with pay statements, completed rental applications, even letters of recommendation from a previous landlord, so that you can be ready to submit everything when an apartment becomes available. If you have a pet that you’re looking to rent with, you may even be required to have a pet resume, which includes information about vaccines and references.
Curious where it’s hardest (and easiest) to find a rental? ApartmentAdvisor analyzed the most competitive markets across the country. For its research, the apartment search site considered its own rental data as well as vacancy rates from October, November and December of 2023 that the U.S. Census Bureau tracks. Factors like how long apartments were listed before they got snapped up were considered, as well as the cost per square foot of rentals. The team analyzed the 75 most populated metro areas in the United States.
Ahead, here’s where you’ll find the most competitive and least competitive rental markets in the United States.
The Most Competitive Rental Markets in the U.S.
While it’s no secret that renting an apartment in the Big Apple is expensive, the most competitive rental market in the country is actually elsewhere in New York.
Syracuse tops the list because there’s an inventory shortage and the cost of renting here has spiked by 23% between the start of 2022 and now, according to ApartmentAdvisor. Interestingly, young people have been moving to this region of New York in hopes of more affordable housing costs, the analysts point out.
In New York City, the current vacancy rate for apartments is 4%, which is considered “healthy,” according to ApartmentAdvisor. But more people are moving into the city than are leaving it, so that could cause more competition in the future.
Short-term rentals in popular vacation destinations are also causing an inventory crunch for longer-term renters in places like Virginia Beach, according to the report.
Here are the top five most competitive rental markets, according to ApartmentAdvisor:
No. 1: Syracuse, New York
No. 2: Greensboro-High Point, North Carolina
No. 3: New York-Newark-Jersey City
No. 4: Virginia Beach-Norfolk-Newport News, Virginia
No. 5: Toledo, Ohio
The Least Competitive Rental Markets in the U.S.
In general, the most competitive markets are clustered on the East Coast and coastal regions. If you’re looking to rent, though, there’s some major metros where there’s still ample inventory and competitive rental costs. For example, Buffalo is bucking the trend in New York and offers one of the least competitive rental markets.
In places like Jacksonville and San Antonio, rent costs are actually going down, according to Zillow.
Here are the least competitive rental markets and where they ranked on ApartmentAdvisor’s list:
No. 71: Jacksonville, Florida
No. 72: Buffalo-Cheektowaga-Niagara Falls, New York
No. 73: San Antonio-New Braunfels, Texas
No. 74: Columbia, South Carolina
No. 75: Cape Coral-Fort Myers, Florida
This story originally appeared on Don't Waste Your Money.
