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 [1].
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 [2] to see recent relevant stories.