San Diego is among the nation’s highest-growth markets for single-family rentals, according to HomeUnion, an online real estate investment management firm that on Tuesday released a list of the U.S. rental markets with the highest year-over-year growth.
Seattle tops the list, with rent growth of 6.7 percent. However, the average cost of renting a single-family home in Seattle, $2,220, remains lower than the average cost of doing so in San Diego. San Diego, where single-family rentals average $2,520, came in ninth on HomeUnion’s list with year-over-year growth of 4 percent.
"Many of the metros at the top of our list have these two common characteristics: strong job growth, and residents who prefer renting over homeownership as median home prices remain relatively high and the cost of mortgage debt continues to increase," said Steve Hovland, director of research at HomeUnion.
Still, while the hottest rental markets continue to have very high rents, HomeUnion’s research revealed that growth slowed in those regions in the past year, Hovland said.
"We're seeing declines in rents for the most expensive Bay Area neighborhoods, as well as slowing rent growth in San Jose submarkets,” he said. “However, rents remain extremely high on a relative basis in both these markets – in the $4,000 range."
El Paso landed at the bottom of the list with a 7.1 percent decline in year-over-year rents.