For the past two-and-a-half years, the pandemic has shaken up the ways that we live and work. The option of working from home has created less of a concern for housing choice.
As a result, cities in the suburbs have been experiencing faster rent growth than the core cities they surround, a recent analysis by Apartment List confirmed.
Nationally, rents have increased by an average of 19.8 percent in the core cities of large metros while the suburbs of these metros have seen rents spike by 27.2 percent. Among 39 metros in the study, 33 have seen rent growth in the suburbs outpacing that of the core city.
In the same timeframe, rents in Dallas are up by 25.3 percent. In the suburbs, rents have increased by 28.4 percent. In the first year of the pandemic, rents in Dallas fell by 0.3 percent, compared to an increase of 2.7 percent in the surrounding suburbs.
Rent prices in the suburb also outpaced the core city in Austin (31 percent to 28 percent), Houston (18/12), and San Antonio (28/22)
Rob Warnock, Apartment List senior research associate who worked on the analysis, said the gap emerged quickly at the start of the pandemic.
“[That’s] when housing demand shifted outward from the city center toward regions that offered better homeownership opportunities, more physical space, more square footage per dollar, etc.,” he said.
In Texas and across much of the Sun Belt, the rent drops were brief even in the core cities, Warnock said.
“These are the metros that attracted new residents from across the country, as marked by low rental vacancy rates,” he said.
As expected, the core/suburb gap is widest in the densest and most-expensive metros (San Francisco, Seattle, Boston, etc.) where city markets cratered, Warnock said.
Inflation and interventions from the Federal Reserve have also slowed the housing market in recent months, “and we expect prices will come down slightly over the course of the winter,” he said.
What is Apartment List? It’s an online marketplace for apartment listings.
Report review: Apartment List has assembled a comprehensive and easy-to-digest collection of dynamic charts and maps. It’s a five-bunny rabbit hole. 🐇 🐇 🐇 🐇🐇
