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As interest rates rise and property values surging preventing more families from buying a homedemand for rentals has skyrocketed, with the highest rental prices in the sunniest states.
Rental prices for single-family homes rose in the first half of 2022, hitting the national average of $2,495 per month — a 13.4% increase compared to the same period in 2021, according to new report from national real estate brokerage HouseCanary.
While warmer cities like California and Florida topped the list of highest median rent prices, midwestern states like Ohio earned the top spots for affordable rent, the report found.
Annual inflation jumped 9.1% in Junegrowing at the fastest pace since the end of 1981, according to the US Department of Labor.
These metropolitan U.S. real estate markets had the highest median single-family monthly rents in the first half of 2022:
- City of Angels; Long Beach, California; Anaheim, California: $4,664
- San Diego; Carlsbad, California: $4,617
- Bridgeport, Connecticut; Stamford, Connecticut; Norwalk, Connecticut: $4,352
- San Jose, California; Sunnyvale, California; Santa Clara, California: $4,294
- Oxnard, California; Thousand Oaks, California; Ventura, California: $4,259
These metropolitan real estate markets had the cheapest average single family monthly rents in the US in the first half of 2022.
- Mobile, Alabama: $1,419
- Dayton, Ohio; Kettering, Ohio: $1,412
- Wichita, Kansas: $1,397
- Akron, Ohio: $1,361
- Canton, Ohio; Massillon, Ohio: $1,314
The pandemic has accelerated the trend of leaving expensive coastal cities for more affordable areas as more Americans he moved to remote work.
And the largest number of US homebuyers are still looking for cheaper options from cities such as San Francisco, Los Angeles and New York, according to July report from Redfin. However, working remotely may have a hidden cost.
While moving to a cheaper area may reduce your rent or mortgage, other unexpected expenses can wreak havoc on your budget, experts say.
“Losing your network or your village is a big hidden cost,” said certified financial planner Bill Parrott, president and CEO of Parrott Wealth Management in Austin, Texas.
Without access to friends and family, expenses like childcare, pet sitting and more can add up quickly, he said.
And travel can be more expensive from a smaller city, depending on your airport or transportation options, said Caleb Pepperday, a Pittsburgh-based CFP and wealth advisor at JFS Wealth Advisors.
“It’s best to research some of these costs before you move to a new city to help make your decision,” he said.