Rents squeezing Jersey City, Boston, Palo Alto residents the most
Jersey City saw the greatest surge in rent increases over the past year
Rent prices across the nation continue to take a significant bite out of consumer budgets. However, some consumers have been getting hit particularly hard over the past year, and it's not in areas you may expect.
Rent – a real estate website owned by the brokerage Redfin – analyzed which U.S. cities were the expensive to rent in based on increases in the area from June 2021 to June 2022.
What Rent researcher Jon Leckie discovered was that there has been particularly "steep price increases in peripheral markets across the country."
A real estate sign in Manhattan in August 2022. (Daniella Genovese/ Fox Business)
So although Manhattan has been grabbing headlines for its eye-popping rent costs, Jersey City, New Jersey, sitting right across the Hudson from the Big Apple, is considered the most expensive city for renters, according to Rent data obtained by FOX Business.
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In Jersey City, the average monthly rent surged from $3,308 in June 2021 to $5,500 in June 2022, according to Rent data obtained by FOX Business. That's an increase of 66.25% in a one-year period.
"Our migration data shows that renters have been leaving bigger, more expensive cities in search of lower housing costs, but generally they're not going far," Leckie said. "They're saying let's get out of the city center where rents are high, to someplace where I can get more space but not so far that I can't go into the office a few times a week. "
A "For Rent" sign outside an apartment building in the East Village neighborhood of New York, US, on Tuesday, July 12, 2022. (Gabby Jones/Bloomberg via Getty Images / Getty Images)
This is leading to a surge in demand in surrounding suburbs and cities, "often more so than in the urban core," he added.
So even though rents in some of these surrounding cities may be cheaper relative to the core metro, prices are in these areas are rising at a much faster rate.
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Like Jersey City, Freemont, California, is another good example of this.
Rents in Freemont surged 45% year-over-year, one of the largest increases tracked by Rent. In comparison, rents in San Francisco and San Jose increased 7.5% and 25%, respectively. While both of those are significant, they are not nearly as high as in Freemont.
A "for rent" sign posted in front of an apartment building on June 02, 2021 in San Francisco, California. (Photo by Justin Sullivan/Getty Images / Getty Images)
Leckie noticed similar patterns in Glendale and Santa Monica, which are just outside of Los Angeles, as well as in Round Rock, Texas, outside Austin, and in Cambridge, which is outside Boston.
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Here are the top ten most expensive cities for rent based on year-over-year price increases, according to Rent:
- Jersey City, New Jersey: Rents increased from $3,308 to $5,500 (66.25%)
- Boston, Massachusetts: Rents increased from $4,164 to $4,878 (17.14%)
- Palo Alto, California: Rents increased from $3,557 to $4,672 (31.34%)
- Glendale, California: Rents increased from $3,280 to $4,472 (36.32%)
- Santa Monica, California: Rents increased from $3,786 to $4,357 (15.07%)
- Coral Gables: Rents increased from $3,007 to $4,310 (43.34%)
- Hoboken, New Jersey: Rents increased from $3,511 to $4,264 (21.46%)
- Redmond: Rents increased from $2,268 to $4,222 (86.11%)
- San Diego, California: Rents increased from $3,339 to $4,202 ( 25.85%)
- Newport Beach: Rents increased from $3,296 to $4,178 (26.79%)