5 Cities with the Biggest Rent Hikes
Many people today rent their homes, either because they cannot qualify for a mortgage or because they choose to rent (whether it’s until they save for a long-term purchase or because they prefer not to make the long-term commitment of a house purchase). While there are some perks that come with renting a home, there are also some drawbacks as well. One of those drawbacks is that you cannot always control what you are going to be paying in rent.
Rental prices can go up at any point in time. In fact, it isn’t necessarily about whether your rent is going to go up, but rather, by how much it goes up. While some areas might only go up by $25 or $50 per month each year, others could jump an extra $100 or more per month. There are a number of different reasons why the rent might go more in one area than another. Some of those reasons include the overall population growth in the state, how many homes are available to rent and how much people are making.
When there aren’t a lot of homes available to rent, landlords can afford to be pickier and raise their rates. They know that people are going to be desperate and looking for a place to go, so they can rest assured that someone is going to be stuck paying their extravagant price. The same thing holds true for the economy. When the economy is on an upswing and people are making more money, they can charge more in rent.
Unfortunately, this is causing a number of families and individuals to be priced out of what they thought was going to be their home for the long haul. If you are worried about having your rent raised on you and not being able to afford it, you might want to take a look at some of the different cities with the largest rent hikes to determine if you should consider looking for somewhere else to live. You deserve to have a home that is going to work for you and your family, without having to feel like you are stretching yourself too thin.
It used to be that people could find an affordably priced home in Oakland, but that isn’t the case any longer. The fair market rates are almost double what they used to be back in 2011. Even though the average family is earning 11.3 percent more than what they did a few years back, the increase in income doesn’t compensate for the rising rental rates.
The main problem in Oakland is that there isn’t enough housing to accommodate the level of demand of all the people who want to live there. This means that rental rates are going to go up due to the housing crisis, leaving many people struggling just to make ends meet. With one-bedroom units renting for more than $2,000 per month, not many people can afford to live on their own here.
San Francisco, California
Out of all the cities in the United States, San Francisco has the highest average rent. When you take into account that the average one or two-bedroom apartment will run you around $3,400 per month, it isn’t easy for many people to afford to live here. This amount was $1,300 less back in 2011, making it virtually impossible for a family to be able to maintain their quality of living from 2011 to 2016.
If you wanted to purchase a home in San Francisco, you will need to be prepared to spend upwards of $1,000,000. It used to be that a family had the option of renting or buying, but now, that isn’t the case. Because of the rising rental prices and home prices, it makes it difficult for many people to be able to afford either option.
New York City, New York
Even though New York City might not have the highest rent in the country, they are still one of the most unaffordable places to live in the United States. The fair market value of rent in the city represents about 72 percent of any average family’s income. This has gone up by 10 percent since 2011. If you were looking to purchase a home using HUD financing, you wouldn’t be able to do so. The dollar amounts are far beyond what HUD deems affordable.
If you want to live in New York City but cannot afford these outlandish prices, you might want to look into getting into one of the rent-controlled apartments the area has to offer. This will prevent you from being hit with an astronomical bill that you in no way can afford. Another thing to look into is going in on a place with a few roommates to split the bill and lower the cost for everyone involved.
San Jose, California
When you compare San Jose to some of the other Bay Area cities out there, the rental market here is a little more affordable to those looking to call this place their home. Fair market rental rates came in at about 34% of an average individual’s income, which is just a little above what HUD would like. This is largely in part because the average salary here is higher than any of the other major cities in the US.
Houston is the home to any number of different business centers. While the average income went up by just over $2,500 per year, the average rental rates went up by $3,000. Even though that only equates to an extra $250 every month, it doesn’t help when your rent goes up by more than what your wages do. Since more people have made their way to Texas for jobs, it has left more people fighting over the available houses to rent.
Regardless of where you might be looking to rent your next place, you need to be aware of the different areas out there and what they have to offer you. Don’t get yourself stuck in a situation where you aren’t able to afford your rent or you are spending the majority of your income in rental payments. Living above your means will only land you in a world of hurt quicker than you think.
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