That’s how expensive the typical rent has gotten, evidence of just how burdensome housing costs can be whether you’re buying a home or not.
The median US rent for new leases rose from $1,962 in April, and it’s now (as of May) over $400 higher than it was just before the pandemic hit, Redfin said Thursday. It hasn’t been more since the real estate data company began tracking rents in 2019.
While the average monthly mortgage payment on a new purchase has risen more than twice as much as the median rent—$865 since just before the pandemic began, according to mortgage data company Black Knight—renters are succumbing to the same market forces. By making it that much less affordable to buy a home, higher mortgage rates and spiraling home prices are in turn sending more people into the rental market.
“Rising mortgage-interest rates are forcing would-be homebuyers to keep renting,” Redfin Deputy Chief Economist Taylor Marr said in a commentary. That situation is “keeping rents sky-high.”
Fortunately for both renters and house hunters, there are signs that the housing market is shifting as more buyers bow out of an increasingly unaffordable market. Home sales have slowed, and some economists foresee price increases decelerating, too. Renters should also expect smaller rent hikes in the coming months, Redfin predicted.
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