Last month, the U.S. median rent was up by 2.4 percent from one year earlier, reaching a new high of $1,435 per month, the highest median rent Zillow has ever reported. Zillow also noted there was synergy between rent prices and incomes, with the latter increasing 2.5 percent year-over-year during November. The greatest rent increases were in West Coast markets, with more than five percent increases recorded in Seattle and California’s Sacrament and Riverside metro areas.
"After about a two-year slowdown, rent growth is starting to pick back up across the nation," said Zillow Senior Economist Aaron Terrazas. "The slowdown in rental appreciation, combined with consistent income growth, gave renters some reprieve from worsening rental affordability over the past few years. But as rental growth begins to catch up with income growth, affordability will deteriorate, placing a squeeze on budget-constrained renters. Looking into 2018, rent is expected to continue gaining steam in growing employment centers, like Dallas and New York, as well as a few smaller markets like Cleveland."
But renters hoping to become homeowners were facing a more expensive housing market. Zillow noted that home values were by 6.7 percent year-over-year in November, with the median home value at $205,100. However, this represented the slowest rate of appreciation since November 2016. Once again, the West Coast was home to the most expensive properties, with San Jose leading the nation by 17.5 percent year-over-year home value growth and a median home value of $1,128,300. Complicating matters was inventory: there were 10.5 percent fewer homes on the market to choose from than a year ago, and San Jose was the leader in this category with a 55 percent decline in its housing inventory from a year ago.