Fafter one of the most disruptive periods of our time, early 2021, the hottest rental markets in the US and most the locations in demand with tenants were certainly not what you would expect.
In an effort to assess the competitiveness of the 125 largest rental markets in our country, we found that mid-sized markets such as Central Valley, CA, Spokane, WA, and Boise, ID were the most in demand in the past quarter. These new tenant centers have a similar history, attracting tenants from larger metropolitan areas, offering cheaper, slower life and a growing number of opportunities. Combined with the shift towards telecommuting, mid-size landlord centers in the country were expected to grow in the first quarter of the year.
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“The largest markets and their adjoining suburbs show that tenants are clearly seeking more square meters or more amenities for the same price in and around these centers. Residents of large mobile markets “trade,” and with work-from-home policies, suburban areas adjacent to these areas also benefit from this behavior. ” says Doug Ressler, business intelligence manager at the Yardi Matrix.
To rank the most popular rental markets in the country, RENTCafé analyzed the industry’s most compelling competitiveness indicators:
• What percentage of apartments were occupied
• How many days of rent remained free
• How many potential tenants applied for apartments
• The rent price trend
Nationally, U.S. apartments remained vacant for an average of 39 days during the first quarter of 2021. 94% of rented apartments were occupied during this time period, with an average of 11 tenants claiming an apartment. The assessment of the tendency of rent for the first three months of the year was 20, showing a slight increase.
The country’s hottest markets emerge from mid-sized locations.
The most popular rental markets in the country follow a general trend: with a few key exceptions, most are medium-sized. The Central Valley, which includes California’s growing hubs such as Fresno, Bakersfield, Stockton and Modesto, is the nation’s most popular rental market with a competitive 5.5 rating.
To see the full ranking, scroll through the table using the bar on the right.
The story of the meteoric rise of the Central Valley is becoming an archetype for the country’s medium-sized cities. In the chicken and egg scenario, these markets are attracting an increasing number of residents looking for cheaper alternatives to expensive markets and moving away from traditional industries (in this case agriculture and energy) to more diversified labor markets.… In the days when the Central Valley was famous for its transit cities are extinction, tenants have looked at this area more and more, making it the most competitive market in the US in the first three months of the year. Peers in mid-size markets in California, Sacramento, and the Inland Empire also made the rankings as more people move from Los Angeles and the Bay Area, according to RedFin.
Spokane, Washington, and Boise, Idaho rank second and third, sharing a similar trajectory. With a competitive score of 10, Spokane apartments very much in demand many potential tenants… The area has been in the headlines since Amazon announced plans to open a new fulfillment center in the city, but the market was on the rise now… Spokane’s mix of small companies and well-paid jobs in government, medicine and higher education has attracted Puget Sound residents for years, especially from the more expensive Seattle area. Meanwhile, third place Boise, Idaho, became known as prime minister moving center for Californiansas the area offers a balance between slower (and cheaper) life, short commutes to work, and the conveniences of a big city.
30 of the most competitive rental markets
The five largest rental centers in the country are also among the 30 most popular apartment markets, all in the south and southwest of the country. El Paso leads this trend with 29.5 points in the competition, ranking 16th among the most popular rental markets in the country.
Phoenix, Arizona was also ranked as the most popular rental market with a competitive score of 39.5. The rapid growth of the Arizona employment center over the past few years has attracted an increasing number of tenants from neighboring states. More recently, the growing tech sector in the market has sparked a new nickname for the region – the Silicon Desert, while the local economy has weathered the pandemic better than other major markets.
“More Americans are getting vaccinated, jobs are increasing, and hybrid work models are emerging, showing growth in multi-unit and commercial real estate. The current climate is increasingly pointing to economic growth in 2021, which will provide significant risk-free potential for the apartment market, ”added Ressler.
Florida also has two major markets in the rankings, Jacksonville and Tampa, with around 40 points. These rental centers have been some of the fastest growing in the country for a while – Jacksonville in particular was the 15th fastest growing city in the country over the past decade. Last but not least, Memphis, Tennessee is keeping a close eye on them with a Competitive Score of 40.75.