Although mortgage interest rates remain a near-record lows, the national median monthly mortgage payment for homebuyers in August grew 67% faster than rental housing payments, according to a new data analysis from Redfin Corp RDFN.
What Happened: August marked the seventh consecutive month where median mortgage payments for new homebuyers grew faster than rental payments. But while mortgage payments for new homebuyers outpaced rent price increases in 25 of the 50 largest metro areas, the national average monthly rent of $1,836 was still greater than the $1,494 median monthly mortgage payment for new homebuyers.
But for renters who are eager to become homeowners, the current housing market may not be as welcoming as they might imagine.
"Record high home price growth has priced many renters out of buying, leaving many facing higher rents this summer as more households look to move thanks to the rise of remote and flexible work arrangements," said Redfin Lead Economist Taylor Marr. "The end of pandemic eviction moratoriums and mortgage forbearance may also cause landlords to raise rents to cover the risk of future tenant protections or make up for lost rental income."
Where It Happened: The majority of the metro areas that experienced the largest year-over-year increases in rents were primarily in warm-weather locations: the top five with the greatest rent hikes in August were Florida’s Tampa (up 29.2% from last year), followed by West Palm Beach, Miami and Fort Lauderdale (all at 28.9%) and Jacksonville (26.8%).
On the flip side, metro areas recording falling rents included Pittsburgh (-5%), San Jose (-3%) and St. Louis (-1%).
Redfin also reported that the median home-sale price increased 14% year-over-year to $358,250 for the four-week period ending Sept. 5. The asking prices of newly listed homes were up 10% from the same time one year earlier to a median of $353,500. This was on par with where asking prices were in late April but is 2% below the all-time high set during the four-week period ending June 27.
Photo: Shahid Abdullah from Pixabay.
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