It will come as a surprise to no one that rent prices in most of the country's largest markets are expected to rise in 2016, according to a forecast from real estate data company Zillow. But there's some good news in that forecast, even for people who live in some of the most expensive cities in the country: Rents won't increase as much as they have been, Zillow predicts.
For example, in 2015, rents in San Francisco grew 12.5 percent, but this year, Zillow expects that growth rate to slow to 5.9 percent. Of course, that's probably not too comforting to a population of renters that already lives in one of the most competitive, expensive markets in the country, especially since Zillow said people in San Francisco can expect to spend 40 percent of their income on rent in 2016.
West Coast rents are an extreme — Zillow data says the three most expensive cities for renters are all in California. At the same time, tenants throughout the U.S. can expect modest rent increases, with a projected annual growth rate of 1.1 percent in 2016, from a median monthly rent of $1,381 to $1,396.
And in some bigger cities, rents are poised to drop. They’re not necessarily the cheapest places to live, but they’re certainly not anywhere near the $3,699-per-month people can expect to pay in San Jose, California, this year.
Out of the 35 largest metro areas in the country, nine cities will see rent price drops in 2016, Zillow predicts.
9. Detroit
December 2015 Median Monthly Rent: $1,132
Projected December 2016 Median Monthly Rent: $1,128
Change: -0.4%
8. Philadelphia
December 2015 Median Monthly Rent: $1,558
Projected December 2016 Median Monthly Rent: $1,550
Change: -0.5%
7. Cleveland
December 2015 Median Monthly Rent: $1,124
Projected December 2016 Median Monthly Rent: $1,117
Change: -0.6%
5. (tie) St. Louis
December 2015 Median Monthly Rent: $1,123
Projected December 2016 Median Monthly Rent: $1,115
Change: -0.7%
5. (tie) Baltimore
December 2015 Median Monthly Rent: $1,714
Projected December 2016 Median Monthly Rent: $1,702
Change: -0.7%
4. Pittsburgh
December 2015 Median Monthly Rent: $1,090
Projected December 2016 Median Monthly Rent: $1,079
Change: -1%
3. Chicago
December 2015 Median Monthly Rent: $1,633
Projected December 2016 Median Monthly Rent: $1,611
Change: -1.4%
2. Las Vegas
December 2015 Median Monthly Rent: $1,212
Projected December 2016 Median Monthly Rent: $1,191
Change: -1.8%
1. Indianapolis
December 2015 Median Monthly Rent: $1,181
Projected December 2016 Median Monthly Rent: $1,138
Change: -3.6%
No matter where you're looking to rent, good credit can make the process of finding a new place a lot easier since landlords tend to look at a version of your credit report when screening tenants. If buying a home is an option, that may be the more economical choice, as a monthly mortgage payment is sometimes less expensive than the median rent in some areas.
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