The Midwest is rising in the ranks of desirable markets for renters thanks to an increasingly diversified economy in tech and manufacturing that is attracting budget-conscious renters seeking affordability, amenities and nature.
This trend is led by suburban Chicago, which topped RentCafe's list of hottest rental markets following a busy peak summer season. Chicago tied with Miami, which has long dominated the list.
Chicago and its suburbs are highly desirable but fiercely competitive for renters, said RentCafe. Demand has been fueled by a recent surge in corporate relocations and expansions, which helped the city jump 11 spots on the list, up from 16th place last year. Vacant units are typically leased within 33 days – almost one week faster than the national benchmark – and each available apartment attracts 16 hopeful renters on average, said RentCafe. Suburban Chicago's occupancy rate rose to 95.6% in peak rental season.
This hints at a shift in America's rental landscape, RentCafe said. Florida's appeal is waning as the Northeast emerged as the most competitive region for renters during the peak moving season. Miami experienced a year-over-year decline in nearly all rental competitiveness metrics except for the share of new units built. Even with this input of new apartments, 71.5% of those already renting chose to renew their leases this summer, down from 73% this time last year. Apartments in Miami typically fill within 32 days and draw an average of 18 applicants per available unit, which is seven fewer than this time last year, according to RentCafe.
RentCafe calculates rental competitiveness based on the the number of days apartments were vacant, the percentage of apartments that were occupied by renters, the number of prospective renters competing for a unit, the percentage of renters who renewed their leases and the share of new apartments completed recently.
Nationwide, occupancy decreased slightly to 93.7% from 94% one year ago. At the same time, vacant apartments stay on the market for an average of 39 days, which is two days longer than a year prior, and there are slightly fewer renters competing for each available unit – nine compared to 10 last summer. Of existing apartment-dwellers, 62% renewed their leases in peak rental season, up from 60.5% one year ago.
The Northeast leads the nation in rental competitiveness, followed by the Midwest, the Mid-Atlantic region and the South. The Pacific Northwest had the lowest rental competitiveness score during this year's peak rental season, RentCafe said.