Rents reach 'insane' levels across US with no end in sight

Associated Press

Krystal Guerra, 32, poses for a picture outside her apartment, which she has to leave after her new landlord gave her less than a month's notice that her rent would go up by 26%, Saturday, Feb. 12, 2022, in the Coral Way neighborhood of Miami. Guerra, who works in marketing while also pursuing a degree part-time, had already been spending nearly 50% of her monthly income on rent prior to the increase. Unable to afford a comparable apartment in the area as rents throughout the city have risen dramatically, Guerra is putting many of her belongings into storage and moving in with her boyfriend and his daughter for the time being. (AP Photo/Rebecca Blackwell)

Krystal Guerra, 32, poses for a picture inside her apartment, which she is in the process of packing up to leave after her new landlord gave her less than a month's notice that her rent would go up by 26%, Saturday, Feb. 12, 2022, in the Coral Way neighborhood of Miami. Guerra, who works in marketing while also pursuing a degree part-time, had already been spending nearly 50% of her monthly income on rent prior to the increase. Unable to afford a comparable apartment in the area as rents throughout the city have risen dramatically, Guerra is putting many of her belongings into storage and moving in with her boyfriend and his daughter for the time being. (AP Photo/Rebecca Blackwell)

Krystal Guerra, 32, does coursework for a degree program in digital marketing, inside the apartment which she is packing up to leave after her new landlord gave her less than a month's notice that her rent would go up by 26%, Saturday, Feb. 12, 2022, in the Coral Way neighborhood of Miami. Guerra, who works in marketing while also pursuing a degree part-time, had already been spending nearly 50% of her monthly income on rent prior to the increase. Unable to afford a comparable apartment in the area as rents throughout the city have risen dramatically, Guerra is putting many of her belongings into storage and moving in with her boyfriend and his daughter for the time being. (AP Photo/Rebecca Blackwell)

Krystal Guerra, 32, accompanied by her dogs Einstein, right, and Stella, does online coursework for a degree program in digital marketing, inside the apartment which she is packing up to leave after her new landlord gave her less than a month's notice that her rent would go up by 26%, Saturday, Feb. 12, 2022, in the Coral Way neighborhood of Miami. Guerra, who works in marketing while also pursuing a degree part-time, had already been spending nearly 50% of her monthly income on rent prior to the increase. Unable to afford a comparable apartment in the area as rents throughout the city have risen dramatically, Guerra is putting many of her belongings into storage and moving in with her boyfriend and his daughter for the time being. (AP Photo/Rebecca Blackwell)

Krystal Guerra, 32, walks inside the apartment which she is packing up to leave, after her new landlord gave her less than a month's notice that her rent would go up by 26%, Saturday, Feb. 12, 2022, in the Coral Way neighborhood of Miami. Guerra, who works in marketing while also pursuing a degree part-time, had already been spending nearly 50% of her monthly income on rent prior to the increase. Unable to afford a comparable apartment in the area as rents throughout the city have risen dramatically, Guerra is putting many of her belongings into storage and moving in with her boyfriend and his daughter for the time being. (AP Photo/Rebecca Blackwell)

Krystal Guerra, 32, pauses to pet her dog Einstein as she does online coursework for a degree program in digital marketing, inside the apartment which she is packing up to leave after her new landlord gave her less than a month's notice that her rent would go up by 26%, Saturday, Feb. 12, 2022, in the Coral Way neighborhood of Miami. Guerra, who works in marketing while also pursuing a degree part-time, had already been spending nearly 50% of her monthly income on rent prior to the increase. Unable to afford a comparable apartment in the area as rents throughout the city have risen dramatically, Guerra is putting many of her belongings into storage and moving in with her boyfriend and his daughter for the time being. (AP Photo/Rebecca Blackwell)

Krystal Guerra, 32, poses for a picture outside her apartment, which she has to leave after her new landlord gave her less than a month's notice that her rent would go up by 26%, Saturday, Feb. 12, 2022, in the Coral Way neighborhood of Miami. Guerra, who works in marketing while also pursuing a degree part-time, had already been spending nearly 50% of her monthly income on rent prior to the increase. Unable to afford a comparable apartment in the area as rents throughout the city have risen dramatically, Guerra is putting many of her belongings into storage and moving in with her boyfriend and his daughter for the time being. (AP Photo/Rebecca Blackwell)

A tiny kitchen, cracked tiles, warped cabinets, no dishwasher, and hardly any storage space are what datememe datememe has for her Miami apartment.

The apartment's flaws were fine with Guerra. She was happy to live in South Florida for a few more years as she finished her marketing degree.

The new owner of the property told her that he was raising the rent by 26%, meaning that she would have to take home less from the University of Miami.

I thought that was insane and I decided to move out. That is unsustainable.

There is more than one Guerra. Rents have exploded across the country, causing many to dig deep into their savings, downsize to subpar units or risk eviction now that a federal moratorium has ended.

In the 50 largest U.S. metro areas, median rent rose an astounding 19.3% from December 2020 to December 2021, according to an analysis of properties with two or fewer bedrooms. In the Miami metro area, the median rent increased to $2,850, 49.8% higher than the previous year.

The Sun Belt destinations of San Diego, Las Vegas, Austin, Texas, and Memphis, Tennessee all saw spikes of more than 25%.

One of the nation's top economic problems is high inflation caused by rising rents. The data from the Labor Department shows small increases in existing rents and new listings. The Labor Department said last week that rental costs rose in January. It was the biggest increase in 20 years, and will likely accelerate.

The impact of rent increases on inflation is a concern for economists.

The biggest increase in inflation in four decades occurred in January. Since housing costs make up one-third of the consumer price index, rising rents could keep inflation high through the end of the year.

In Boston, which has nearly overtaken San Francisco as the nation's second-most expensive rental market, one resident jokingly put an igloo on the market for $2,700 a month.

A nationwide housing shortage, extremely low rental vacancies, and continued demand for young adults are some of the reasons why rents are so high.

Whitney Airgood-Obrycki, lead author of a recent report from Harvard University's Joint Center for Housing Studies, said there was a lot of demand after the initial months of the Pandemic. She said that rents really took off as the economy opened up and young people moved out.

Rental vacancies fell to 5.6% in the fourth quarter of 2021, the lowest since 1984.

Danielle Hale said that landlords have some pricing power because they are not sitting on empty units that they need to fill.

The low number of homes for sale has contributed to ballooning home prices that have caused many higher-income households to remain renters.

An estimated 5.8 million single- family homes will not be built in the next year because of material and labor shortages, a jump from the end of last year.

The increasing presence of investors is a potential compounding factor.

In the third quarter of 2021, 18.2% of U.S home purchases were made by businesses or institutions, a record, as investors targeted popular destinations such as Atlanta, Phoenix, Miami, Charlotte, North Carolina, and Jacksonville, Florida.

She said that investors have pricing power due to low vacancies and that is why they are a factor in rent hikes.

Most investors are not tied down by rent control. Only two states, California and Oregon, have statewide rent control laws, while three others, New York, New Jersey and Maryland, have laws that allow local governments to pass rent control laws.

Laws in Arizona restrict local governments from limiting what landlords can charge tenants.

In Tucson, Arizona, the mayor's office said it has been flooded with calls from residents worried about rent hikes after a California developer bought an apartment complex that caters to older people and raised rents by more than 50%.

The rent on a one-bedroom apartment in the complex went from $579 to $880 a month, an increase legal under Arizona state law.

Arizona's rapidly growing housing costs have been a major concern for Sen. Sinema for years.

Hale expects rents to rise this year, but at a slower pace due to increased construction.

Hale expects rents to rise 7.1% in 2022.

In Miami, the woman is packing her belongings ahead of her March move-out date. She spent weeks frantically looking for places in her budget but said she couldn't find anything that wasn't broken down or an hour away from work.

Even though the timing is not ideal, she is going to put her things in storage and move in with her boyfriend.

We didn't want to have the decision of moving in together forced upon us.

There is a

The report was contributed to by Associated Press Economics Writer Christopher Rugaber in Washington.

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