Amid a historic bout of inflation over the past year, the cost of housing – and especially rent – has been one of the most significant pressures on home finance. In many markets, renters see increases of 20% or more when they sign new leases, and with the nationwide rental vacancy rate at just 5.6%, renters have few alternatives to find more affordable options.
The current state of the rental market is a product of both supply and demand, with problems accumulating over time and focusing on-
since the epidemic began.
Zoning and density restrictions have made it difficult to add housing stock in many locations, both for rentals and in the real estate market.
With real estate prices soaring, 70% of the rental market growth since 2009 has come from high-income earners who might otherwise have bought a home.
As more high-income earners enter or remain in the rental market, builders and developers are incentivized to provide more luxury units, which means less new inventory to meet the needs of low and middle income earners.
The COVID-era economy has exacerbated all of these issues.
Ongoing supply chain challenges have made sourcing building materials time-consuming and expensive, while a tight job market has left hundreds of thousands of construction jobs vacant.
Prices are a result of these factors, with a 17% annual increase in rental costs from February 2021 to February 2022, according to data from Zillow. By comparison, the typical annual increase has held steady between 3% and 5% for most of the past decade.
The recent increases stand in stark contrast to the first year of the pandemic, when increases fell below 1% as landlords and renters weathered the economic uncertainty of the pandemic, and federal and state governments implemented rent assistance
No segment of the rental market has been spared the cost of rising rents, from couples or couples in a studio or one-bedroom unit to families renting a three- or four-bedroom home.
According to US Department of Housing and Urban Development data, units of all sizes experienced price increases of more than 10% for the average unit between 2019 and 2022.
The effect of higher rental prices differed somewhat by geographic region. Several states in the southern and central US have seen lower levels of increase, and one state – Alaska – has seen a 3% drop in rental costs since 2019.
The analysis found that the median rent in the Milwaukee metro area is now $1,080, compared to $988 in 2019 — an increase of 9.3%. Here is a summary of the Milwaukee-Waukesha, Wisconsin metro area data:
Percentage change in average rent (2019-2022): +9.3%
Total change in median rent (2019-2022): + $92, median rent (2022): $1,080
Average rent (2019): $988
For reference, here are the stats f
or the entire United States:
Percentage change in average rent
Total change in average rent (2019-2022): + $161
Average rent (2022): $1,445
Average rent (2019): $1,284
For more information, detailed methodology and complete results,
You can find the original report on the Stessa website