The median monthly asking rent in the U.S. reached a record high in March, with the Sunshine State also seeing increases in several metropolitan areas, according to a new report from Redfin.
The technology-powered real estate brokerage said that asking rent nationwide increased 17% year over year to a record high of $1,940 in March. The increase marked the largest annual jump since at least February 2020. The report also showed that the national median monthly mortgage payment for homebuyers rose twice as fast — climbing 34% year over year to $1,910, also the biggest increase in Redfin’s records.
The March study noted that the increase in monthly mortgage payments is largely due to mortgage rates climbing from under 3% to 5% since the start of 2022. Redfin added that the monthly mortgage payments are pricing people out of the homebuying market, which they speculate could lead to even more increases in rents.
“Many potential first-time homebuyers are quickly being priced out of the market by record-high home prices and fast-increasing mortgage rates,” said Redfin Chief Economist Daryl Fairweather. “They are then faced with two options: rent or move somewhere with a lower cost of living. Those who choose to rent may save money in expensive housing markets in the near term, but long term, they may have to deal with continued rent increases, year after year. Those who move and buy somewhere more affordable now will be paying considerably more than if they bought last year, but will be able to build equity in the long run and ensure relatively stable monthly housing costs going forward.”
The report also found that mortgage payment increases outpaced asking rent increases in 44 of the 50 largest U.S. metro areas in March. Rent increases hit 40% year over year in Portland, OR, with Austin, TX not far behind at 38%. The Tri-State Area and many parts of Florida also saw rental increases of 30% or more.
The four metro areas in Florida that saw the fastest-rising rents year over year were Fort Lauderdale (33%), Miami (33%), West Palm Beach (33%), and Orlando (30%).
Additionally, just two of the 50 most-populous metro areas saw rents fall in March from a year earlier. Rents declined 10% in Milwaukee and 1% in Kansas City.
To view the full report from Redfin, click here.