As home prices have continued to soar and mortgage rates remain high, many would-be first-time buyers are opting to stay in the rental market longer.
This might be the more doable financial option for many — with median rent prices continuing to decline across the nation for the sixth month in a row −— but those living in the Northeast have experienced consistent price increases in comparison, according to Realtor.com's January 2024 Rental Report.
What do rent prices look like across the country?
In the country's 50 largest metropolitan areas, median rent prices were approximately $1,721 in January, a 0.3% decrease from the same time last year.
This is a slower decrease compared to the 0.8% year-over-year decrease seen in December 2023, and median asking rents nationwide are still about $265 more than those seen before the pandemic in 2020.
Studio units have seen the largest rent declines across the country, with prices decreasing by 1% compared to January 2024 and with median asking rents of $1,434. These prices are down by $56 from its peak in October 2022, but $153 higher than before the pandemic.
Two-bedroom rentals have seen the second largest rent decline at 6%, with median asking rents of $1,892. In comparison, one-bedroom rentals have seen a 0.1% increase in prices compared to January 2023, with median asking rents of $1,591.
How do rental prices in New Jersey compare?
Compared to big Western rental markets like Phoenix, Riverside and Las Vegas — which all saw rent prices decline for eight months before seeing their first year-over-year price growth in January 2024 — the New York metropolitan area has experienced faster rent growth.
This region — which includes the North Jersey counties of Hudson, Bergen, Passaic, Morris, Essex and Sussex — has median rents of $2,844. This is 2.3% more than median rent prices seen in our area this time last year.
The report credits the steady increase in rent prices in our area to expensive home prices and high mortgage rates are keeping buyers in the rental market, boosting demand and putting pressure on rents in popular areas.
A strong labor market and the slowing growth of new multi-family homes is also said to play a role in increasing prices.
"Consequently, the stronger labor market in the Northeast is likely contributing to an increased demand for rentals, rendering it more competitive compared to the rental market in the West," according to the report.
"Although both regions saw record-high new multi-family starts in 2022, we expect a significant portion of 2022 starts in the Northeast to be completed in 2024," the report reads.
How were these finding compiled?
Realtor.com analyzed rental data for studio, one-bedroom and two-bedroom units advertised as for-rent on their site as of January 2024. Rental units include apartments and private rentals such as condos, townhomes and single-family homes.
Maddie McGay is the real estate reporter forNorthJersey.comand The Record, covering all things worth celebrating about living in North Jersey. Find her onInstagram @maddiemcgay,onX @maddiemcgayy, and sign up for herNorth Jersey Livingnewsletter.Do you have a tip, trend or terrific house she should know about? Email her atMMcGay@gannett.com.
