Rental Market Tracker: Mortgage Payments for New Homebuyers Are Rising 67% Faster Than Rents

Rental Market Tracker: Mortgage Payments for New Homebuyers Are Rising 67% Faster Than Rents

Updated on May 26th, 2022

However, rents are climbing rapidly in some places, up over 20% from a year earlier in many Florida metros, Riverside, CA, Phoenix and Las Vegas.

Nationwide, average monthly rents increased 9% over the past year in August. However, the national median monthly mortgage payment for homebuyers rose 67% faster than rents during the same period. This is despite mortgage interest rates falling back to near-record lows. This is the seventh consecutive month that growth in median mortgage payments for new homebuyers has outpaced that of rents. However, in August, growth in rents were speeding up while growth in mortgage payments were slowing.

Rents and Homebuyer Mortgage Payments Both Rising Sharply in 2021

Mortgage payments for new homebuyers outpaced rent price increases in 25 of the 50 largest metro areas in the US during August.

Redfin’s inaugural rent-versus-own analysis uses data from more than 20,000 apartment buildings across the US. The report combines rental data on all sizes of apartments for rent with home sales data on all residential home sales (single-family, townhouse and condos) from public records and the MLS. When this report refers to the median mortgage payment for new homebuyers, it is based on a 5% down payment, the median sale price during the month and the average mortgage interest rate for the month. The report uses a 5% down payment in order to be comparable to what an average renter may be able to reasonably achieve in savings.

Nationwide, the average monthly rent of $1,836 is still larger than the $1,494 median monthly mortgage payment for new homebuyers.

Rents and Homebuyer Mortgage Payments Both Rising Sharply in 2021

“Record high home price growth has priced many renters out of buying, leaving many facing higher rents this summer as more households look to move thanks to the rise of remote and flexible work arrangements,” said Redfin Lead Economist Taylor Marr. “The end of pandemic eviction moratoriums and mortgage forbearance may also cause landlords to raise rents to cover the risk of future tenant protections or make up for lost rental income.”

Austin has always been a hot real estate market, but the past six months have been wild,” said Redfin Austin market manager Jennifer Hoffer. “We’ve been working with several landlords who want to sell their properties to cash in on high home prices. But renters right now really don’t want to move, so they’re staying put with long-term leases because they have nowhere to go. I think we will see a spike in rents in the next few months as leases come to an end.”

Where Rents Rose and Fell the Most

Most of the metro areas with the biggest increases in rent were warm, affordable destinations in Florida, California and Arizona that have benefitted from a surge in migration thanks to a newly mobile workforce. Rents were up the most from a year earlier in Tampa, FL (29.2%), followed by West Palm Beach, FL, Miami, FL and Fort Lauderdale, FL (all at 28.9%).

Top 10 Metro Areas With Fastest-Rising Rents

However, rents are not increasing everywhere. A few metro areas saw decreases, including expensive areas where people are moving away like the Bay Area. Rents were down in Pittsburgh (-5%), followed by San Jose, CA (-3%) and St. Louis, MO (-1%).

Metro Areas With Falling Rents

These price drops are the rare exception to nearly across-the-board increases in housing costs for both rentals and homebuying, and are not likely to last as the economy recovers from the pandemic. For those who need to move and are looking for a place to rent, now may be a good time to check out some traditionally more expensive coastal metro areas such as the Bay Area, Boston, and Washington, D.C., where rental costs are rising slower than the 8.5% national average.

Year-Over-Year Change in Rents and Median Monthly Mortgage Payments for Homebuyers, August 2021

Metro AreaAverage RentYear-Over-Year Change in Average RentMedian Monthly Mortgage (5% down)Year-Over-Year Change in Median Monthly Mortgage (5% down)Difference Between Year-Over-Year Percentage Point Change in 5% Down Mortgage Payment & Rent
Anaheim, CA$3,3437.6%$3,57012.3%4.8 pts
Atlanta, GA$1,98517.6%$1,29515.5%-2 pts
Austin, TX$2,08417.0%$1,86434.0%17 pts
Baltimore, MD$2,10918.3%$1,3383.6%-14.7 pts
Boston, MA$3,5514.2%$2,4729.3%5.1 pts
Charlotte, NC$1,84410.6%$1,35014.7%4.2 pts
Chicago, IL$2,4308.5%$1,1975.6%-2.8 pts
Cincinnati, OH$1,3389.2%$9737.8%-1.4 pts
Cleveland, OH$1,4157.2%$78510.3%3.1 pts
Columbus, OH$1,52612.7%$1,11812.5%-0.1 pts
Dallas, TX$1,93612.3%$1,49116.1%3.8 pts
Denver, CO$2,47214.4%$2,08315.2%0.8 pts
Detroit, MI$1,5086.2%$71412.3%6.1 pts
Fort Lauderdale, FL$2,74528.9%$1,40910.8%-18.2 pts
Fort Worth, TX$1,93612.3%$1,24918.6%6.3 pts
Houston, TX$1,6965.3%$1,20814.7%9.5 pts
Indianapolis, IN$1,2667.8%$9818.5%0.7 pts
Jacksonville, FL$1,68426.8%$1,21315.2%-11.6 pts
Kansas City, MO$1,4122.9%$1,0796.5%3.5 pts
Las Vegas, NV$1,73821.3%$1,47119.4%-1.9 pts
Los Angeles, CA$3,3437.6%$3,21714.0%6.4 pts
Miami, FL$2,74528.9%$1,62817.1%-11.9 pts
Milwaukee, WI$1,87116.6%$1,077-0.6%-17.2 pts
Minneapolis, MN$1,8562.6%$1,3738.8%6.3 pts
Montgomery County, PA$2,20610.9%$1,5928.3%-2.7 pts
Nashville, TN$1,7795.3%$1,55018.2%12.9 pts
Nassau County, NY$3,48621.3%$2,35414.5%-6.9 pts
New Brunswick, NJ$3,48621.3%$1,68711.7%-9.6 pts
New York, NY$3,48621.3%$2,59914.3%-7 pts
Newark, NJ$3,48621.3%$1,9238.7%-12.6 pts
Oakland, CA$3,5301.5%$3,72813.0%11.5 pts
Orlando, FL$1,94520.9%$1,30714.7%-6.1 pts
Philadelphia, PA$2,20610.9%$1,07910.8%-0.1 pts
Phoenix, AZ$1,99921.9%$1,61723.3%1.4 pts
Pittsburgh, PA$1,604-5.1%$8637.9%13 pts
Portland, OR$2,20718.3%$2,02914.7%-3.5 pts
Providence, RI$2,35913.0%$1,53015.5%2.5 pts
Riverside, CA$2,69623.1%$1,98116.6%-6.5 pts
Sacramento, CA$2,54218.6%$2,16615.9%-2.6 pts
San Antonio, TX$1,2550.6%$1,16614.0%13.4 pts
San Diego, CA$3,16917.4%$2,94313.0%-4.3 pts
San Francisco, CA$3,5301.5%$5,9840.4%-1.2 pts
San Jose, CA$3,298-2.9%$5,3269.8%12.7 pts
Seattle, WA$2,67512.4%$2,86414.4%2 pts
St. Louis, MO$1,515-0.5%$9025.1%5.7 pts
Tampa, FL$2,07729.2%$1,23617.4%-11.8 pts
Virginia Beach, VA$1,64015.2%$1,1427.0%-8.2 pts
Warren, MI$1,5086.2%$1,0779.3%3.1 pts
Washington, DC$2,5134.8%$1,9234.1%-0.6 pts
West Palm Beach, FL$2,74528.9%$1,44111.6%-17.4 pts
National$1,8368.5%$1,49414.8%6.3 pts


Redfin analyzed home sales data from the MLS, and public records and rent prices from RentPath, across the 50 largest metro areas in the US. Monthly rental prices in this report are not directly comparable to monthly homebuyer mortgage payments, since the mix of homes available to rent and the mix of homes being purchased differ in location, size and quality of home within each metro area. For example, most of the homes being purchased may be in the less expensive suburbs of the metropolitan area, while the apartments being rented may be closer to the more expensive city core.

It is also important to note that the prices in this report reflect the current costs of new leases and new mortgages during each time period. In other words, the average rent of $3,343 in the Anaheim metro area is not the average of what all renters are paying, but the average cost of apartments that were available for new renters during August 2021. Likewise, the median monthly mortgage payment of $3,570 in Anaheim was only for homes that sold during the month of August 2021, not for all homeowners.


Tim Ellis

Tim Ellis has been analyzing the real estate market since 2005, and worked at Redfin as a housing market analyst from 2010 through 2013 and again starting in 2018. In his free time, he runs the independently-operated Seattle-area real estate website Seattle Bubble, and produces the "Dispatches from the Multiverse" improvised comedy sci-fi podcast.

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