Concept - investments of Real Estate. Passive income from the property. Real estate investor. Investing in the property. Commercial building. Money is falling on the house. Profitable real estate.
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A slowdown in construction and tight home inventory is putting upward pressure not just on home prices, but on rental costs. While some consumers become priced out of the market, others have too limited a selection to choose from.
The national average rent continued its ascent in August, rising 3.3% in one month to $1,472, according to apartment search platform Rentcafe. While rent did rise at a slower pace than it did during the same period a year ago, monthly rent in some cities sits well above the country norm.
Assuming the nation's median monthly mortgage payment is still within range of the $1,030 average recorded in 2018 by the Census Bureau, consumers in high-rent housing markets may be particularly swayed to buy a house. Even if trends with local purchase values align as also being pricier, the investment aspect of owning property may incentivize certain consumers to do so.
While in some areas average rent sits well under the thousand-dollar mark, in others, figures above $4,000 are standard. From Manhattan to Denver, here's a look at 12 housing markets with the highest monthly rent.
The data for the rankings is derived from a report by Rentcafe and its sister company, Yardi Matrix, which analyzes monthly rent prices across the nation's largest cities.
Denver Cityscape Colorado. Downtown Denver Skyline and the Mile High Stadium. Colorado, United States.
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No. 12 Denver, Colo.
Average monthly rent: $1,670 Amount over national average: $198 Month-over-month change in rent: -0.3%
Aerial view of Chicago, Illinois skyline with Soldier Field.
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No. 11 Chicago, Ill.
Average monthly rent: $2,007 Amount over national average: $535 Month-over-month change in rent: 0.3%
Seattle Public Market Sign, Pike Place Market, Seattle WA, USA
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No. 10 Seattle, Wash.
Average monthly rent: $2,130 Amount over national average: $658 Month-over-month change in rent: -0.5%
Old Post Office Pavilion
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No. 9 Washington, D.C.
Average monthly rent: $2,227 Amount over national average: $755 Month-over-month change in rent: 0%
San Diego, California, USA downtown city skyline.
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No. 8 San Diego, Calif.
Average monthly rent: $2,236 Amount over national average: $764 Month-over-month change in rent: 0.7%
Aerial view of complex highway interchange in Los Angeles California.
Ron Chapple Stock/iofoto - Fotolia
No. 7 Los Angeles, Calif.
Average monthly rent: $2,525 Amount over national average: $1,053 Month-over-month change in rent: 0.2%
The Unispere and the World Fair Tent of Tomorrow and sunset
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No. 6 Queens, N.Y.
Average monthly rent: $2,586 Amount over national average: $1,114 Month-over-month change in rent: 0.6%
Drone point of view of Silicon Valley in California
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No. 5 San Jose, Calif.
Average monthly rent: $2,790 Amount over national average: $1,318 Month-over-month change in rent: -0.1%
No. 4 Brooklyn, N.Y.
Average monthly rent: $2,940 Amount over national average: $1,468 Month-over-month change in rent: 0.5%
BOSTON, MA, USA - JUNE 28, 2017: Aerial image of Fenway Park sports stadium home to the Boston Red Socks
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No. 3 Boston, Mass.
Average monthly rent: $3,545 Amount over national average: $2,073 Month-over-month change in rent: 0.3%
View of colorful San Francisco row homes looking down a steep city street
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No. 2 San Francisco, Calif.
Average monthly rent: $3,706 Amount over national average: $2,234 Month-over-month change in rent: 0%
Wall street view from a Blade helicopter in New York City in New York, U.S., on Tuesday, May. 7, 2019. Photographer: Jeenah Moon/Bloomberg
Jeenah Moon/Bloomberg
No. 1 Manhattan, N.Y.
Average monthly rent: $4,272 Amount over national average: $2,800 Month-over-month change in rent: 0.7%
While some industry forecasts predicted origination volumes would fall 7% quarter-to-quarter in 4Q, early earnings numbers from Wells Fargo, JPMorgan Chase, Citi and PNC Bank show they were down just 3% when purchased loans are excluded.
Despite mortgage rates expected to rise modestly in 2021, a bolstered Biden administration stimulus package and COVID-19 vaccination efforts bring promise for economic recovery.
The FHFA and Treasury will allow Fannie Mae and Freddie Mac to hold more capital as part of the Trump administration's plans to release the companies from conservatorship. But it is unclear whether the incoming Biden administration will keep the mortgage giants on the same reform path.