Consumers on the hunt for a new rental home this summer can expect to pay higher prices than last year, especially for anyone searching for two- or three-bedroom homes. That’s according to the recently issued Q2 2018 HotPads Rent Report.
HotPads reports that rent prices rose 2.8 percent over the past year for both two- and three-bedroom rentals. Two-bedroom rentals are averaging around $1,310 per month, whereas three-bedroom rentals are sitting at around $1,445 per month. In comparison, average rent for a one-bedroom unit was around $1,275 in Q2, up 2.2 percent year-over-year.
In some cases, the rent price appreciation is obviously worse than in others. HotPads reports that median rent for a two or three-bedroom home is appreciating more than twice as fast as rent for a one-bedroom home in metros such as Baltimore, Washington, D.C., and Austin.
Median rent overall was up 2.5 percent year-over-year, hitting $1,480 per month. With both home prices and rent on the rise across the nation, affordability concerns are deepening for many consumers looking to find a new home.
“Rent growth has mellowed out to a steady rate recently, but overall prices are still high compared to recent years,” said Joshua Clark, Economist at HotPads. “Two and three-bedroom rentals are seeing the fastest pace of price growth this year, usurping one-bedrooms as the fastest-appreciating segment of the rental market in April 2018. New apartment construction tends to focus on studios and one-bedrooms, so the additional supply of smaller units has eased price pressures in that market segment. Renters looking for a larger apartment or home—including young families—should expect faster rent growth this year.”
That’s good news for investors in the rental space. To read more about recent rental trends, click here to see recent relevant stories.