With the housing market continuing to experience challenges in the form of elevated mortgage rates and high home prices, renting has become a frequented option for would-be buyers. But, with rent prices rising in response to today’s challenging housing market and low levels of inventory, where can renters turn to find the best rental markets?
RentCafe’s latest Rental Competitivity Report analyzed 137 areas where data was available to rank the nation’s best rental markets, using five key indicators in terms of competitiveness: days apartments were vacant, percentage of apartments occupied, how many renters applied, percentage of renewed leases and share of new apartments completed.
The report found that Florida dominated the top five markets, claiming three spots, proving that the South is a definite contender for renters to flock to.
The top 5 hottest rental markets this season:
- Miami-Dade County, Florida. On average, apartments were vacant for 33 days, with 97.1% of units occupied. With 24 prospective renters per unit, RentCafe reports a 71.8% lease renewal rate and a 0.9% share of new apartments.
- North Jersey, New Jersey. While apartments were vacant an average of 40 days in North Jersey, 96.4% of units are occupied. North Jersey boasts 14 prospective renters per unit, a 70.9% lease renewal rate and a 0.3% share of new apartments.
- Southwest Florida. With an average of 34 days vacant, 96.1% of units are occupied. RentCafe reports 13 prospective renters per unit, a 67.2% lease renewal rate and a 0.9% share of new apartments.
- Broward County, Florida. Apartments were vacant an average of 41 days in Broward County, with 95.5% of units occupied. With 14 prospective renters per unit, RentCafe reports a 66.8% lease renewal rate and a 0.1% share of new apartments.
- Omaha, Nebraska. While apartments were vacant an average of 34 days, 96.2% of units are occupied. Omaha boasts 14 prospective renters per unit, a 62.5% lease renewal rate and a 0.5% share of new apartments.
Major takeaway:
Using this data, RentCafe also calculated the Rental Competitivity Index (RCI) to measure how competitive the rental market is. This rental season, the national RCI score is 60, which means the apartment market is moderately competitive.
“The wave of new apartments completed in the last two years—coupled with economic uncertainties—has affected all metrics used in this competitivity report,” said Veronica Grecu, a senior creative writer for RentCafe and author of the report. “For example, at the national level, 94% of rental apartments are occupied this rental season. That’s slightly less than this time last year when the U.S. occupancy rate was a higher 95.1%.”
Grecu added, “Furthermore, vacant apartments are taking longer to fill this year, 43 days on average, with only nine prospective renters competing for each available unit. By comparison, last year, apartments were filled one week faster, and four more applicants were competing for the same rental.
“Moreover, less than 60% of apartment dwellers signed lease renewals as opposed to searching for a new home in the first months of 2023. Looking back one year ago, more renters renewed their leases (65.6%) because they had fewer options to choose from at that time,” concluded Grecu. “Out of the 137 markets analyzed, approximately 37% show signs of softening in at least four of the five relevant metrics in terms of competitivity. Most often we see a decrease in the share of lease renewals and a rise in the number of days vacant apartments stay on the market.”
For the full report, click here.
