These Cities Are Expected to Have the Highest Rent Prices in 2023

Written by Ashley Sutphin Posted On Monday, 06 February 2023 00:00

As we look ahead to the rest of this year, New York is anticipated to be the year’s most expensive rental market, and that’s unlikely to change.

The median rent in December 2020 in New York City was $2,399, and it’s gone up 56% since then to a median price of $3,738 in December 2022.

Before the pandemic, you could expect to see median rents in NYC of around $3,000 for a one-bedroom. Prices rose significantly throughout 2021 and continued a somewhat steady rise for the bulk of 2022.

So what’s the reason, especially considering a lot of the population that fled in the early days of the pandemic hasn’t come back? The biggest reason is that there just isn’t an enormous inventory of affordable housing. New York is notoriously undersupplied regarding available housing, so there’s tremendous competition for affordable rentals.

While people might not have returned to New York, that doesn’t mean others don’t want to move there. In 2022, more people actually ended up moving there compared to what was typical before the pandemic.

Next for the highest rent prices in 2023 is nearby Jersey City, New Jersey. Jersey City is absorbing the people who can’t afford New York, but that’s, in turn, increasing rent prices there as well. The median rent in December 2020 was just $1,825 in Jersey City, and now, there’s a 70% increase, with the median rent in December 2022 being $3,102.

There have been record application numbers for apartments near New York City, so much like the city core, the demand for Jersey City rentals probably isn’t declining anytime soon.

Similarly, the Boston housing market is like many other big cities across the country—there is a severe undersupply of housing. Boston faces especially big issues with supply because of zoning laws that favor single-family homes.

New inventory in Boston tends to be skewed more toward the luxury market, leading to a 40% increase in median rent prices from December 2020 to December 2022.

San Francisco’s rent prices haven’t returned to where they were before the pandemic, but it’s still one of the country’s most expensive rental markets. In 2019, the median rent price hit a peak of $3,700. While New York was the most expensive market for rentals in 2022, San Francisco hung on to that tile for six years before.

From December 2020 to December 2022, there was a 12% change in the median rent price in San Francisco, which jumped from $2,668 to $2,975.

Miami has seen a surge of new residents in the past few years, which is true of many of the markets in Florida. In February 2021, Miami was the country’s 14th most expensive rental market. By March of last year, it was the fourth-most expensive market, and it’s stayed in that spot since then.

There was a 64% increase in Miami’s median rent prices as they went up from $1,647 in December 2020 to $2,705 in 2022.

At the end of 2022, the median rent in the U.S. was $2,305, almost 5% higher than a year before. Compared to the end of the first half of 2022, median rent had gone down almost 6%, according to a report from House Canary.

Rent prices are cooling in some markets, but in others, they’re continuing to rise, reflecting the mixed picture that is real estate in general and the economy in the U.S. right now.

While they aren’t the most expensive, the five U.S. markets with the most significant yearly percentage increases in median monthly rental prices for single-family properties included Indianapolis, Charleston, New Haven, Naples, and Pittsburgh.

By contrast, the markets with the most significant annual decreases were Memphis, Port St. Lucie, Cape Coral, Palm Bay, and Phoenix.

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