Housing affordability may be at a record low, but rentals are not a bargain either, according to two year-end reports.
Zumper just released their annual year-end report looking at real estate trends in 2018. A few key findings include:
Rent is not getting cheaper: The average one bedroom in San Francisco is now $3,560, a 5% year-over-year increase and Boston is up to $2,489 a 10% jump from this time last year
The American Dream is starting to not include homeownership: In the survey, 33% of respondents said that they do not believe that the American Dream involves homeownership.
Millennials are still relying on mom and dad: Twenty percent of 18-24 year olds require help with rent from parents. Here are the top cities where there are the most "Millennial Moochers." Detroit was at the top of the list.
A Zillow subsidiary also has been studying the fortunes of renters, and found U.S. households spent a record amount on rent in 2018 despite a decrease in the number of households who rent their home. The new HotPads® analysis found the U.S. spent $504.4 billion on rent in 2018 – more than the entire GDP of Belgium ($494.7 billion)i and three times the current net worth of Amazon CEO Jeff Bezos ($124 billion)ii.
Renters spent $12.6 billion more paying their rent in 2018 than they did in 2017. The current median rent is $1,475, up 3 percent from a year ago. Throughout 2018, rents rose about 3 percent year over year – continuing a gradual slowdown in rent appreciation that began in mid-2016.
However, the number of renter households in the U.S. decreased slightly in 2018. There were about 43.2 million renter households across the country this year – nearly 100,000 fewer than in 2017.
A gradual slowdown in rent appreciation has allowed renters looking to purchase homes greater ability to save for a down payment in recent years, and millennials – the generation comprising half of today's renters -- are also buying homes more than any other generation. With more eligible buyers on the market, the number of renter households has decreased slightly over the past year.
REAL Trends has been The Trusted Source of news, analysis, and information on the residential brokerage industry since 1987. We are a privately-held publishing, consulting and communications company based in Castle Rock, Colorado.
Accessibility: We are making efforts to be ADA Compliant. Should you have any challenges or questions please contact us at (303) 741-1000.