You may have heard or seen firsthand how fast home prices have risen. In January, home value appreciation was 9.1% higher than one year prior, the largest annual increase since 2006, according to new data from Zillow.
Perhaps less known is this: The cost of renting is affected, too. But unlike with home prices — rising across most of the country — rents are up in some cities and down in others.
Overall, the cost of renting was relatively stagnant in the United States last year, say Zillow economists. The company, a real estate website, tracks and analyzes home prices and rents. The typical rent this January, $1,721, was up just $9, or 0.5%, from January 2020.
But that flat line masks big changes.
“The COVID-19 pandemic and widespread changes to work-from-home policies have also pushed many to reconsider what they want and need in their living space, and where it should be,” says Zillow.
Many workers were freed to work from home and live virtually anywhere, at least while pandemic lockdowns lasted.
Rents in pricey, formerly desirable coastal meccas — especially New York City, Boston and the Silicon Valley centers of San Francisco and San Jose — saw the most dramatic drops in rents.
Below, listed by the change from January 2020 to January 2021, are the nine major metropolitan areas where rent costs are down, according to the Zillow Observed Rent Index. Even with reductions, rents in these metros remain steep:
- San Francisco: $2,876 (down 9.2% from January 2020)
- New York City: $2,465 (down 8.8%)
- San Jose, California: $2,892 (down 7.2%)
- Boston: $2,277 (down 6.3%)
- Seattle: $1,866 (down 5.5%)
- Washington, D.C.: $2,006 (down 3.4%)
- Chicago: $1,614 (down 2.9%)
- Austin, Texas: $1,511 (down 1.2%)
- Los Angeles-Long Beach-Anaheim, California: $2,542 (down 0.8%)
In the rest of the 50 largest metro areas in the U.S., rent increased on Zillow’s index between January 2020 and January 2021. These increases were as small as 0.1% in Denver and as big as 10% in Memphis, Tennessee.
A recent analysis by MyMove, a website that helps people relocate, also found that many people who moved during the pandemic left crowded urban areas for (often nearby) smaller cities and suburbs.
MyMove analyzed U.S. Postal Service change-of-address requests filed from February through July 2020. It found that the number of requests for temporary moves — meaning requests from people who planned to live at the new address for less than six months — increased about 27% compared with the same period in 2019.
New York City (110,978 people moved), including its borough of Brooklyn (43,006), lost the most residents to moves, followed by Chicago (31,347), San Francisco (27,187) and Los Angeles (26,438).