Growing Rent Divide Between Large and Small Markets

Posted By: Jon Lowder Blog ,

RealPage has an interesting post on their blog about the growing divide in average rent rates between large and small metro markets, and how that divide grew:

At the start of the current economic cycle in early 2010, the 50 largest markets were reaping average monthly rental rates of $1,224, while prices in the secondary markets averaged at $809, a $415 difference. Ten years later, that gap has widened to $661...

While major markets have led for total rent growth on a same-store basis over the cycle, the difference is relatively slight. The bigger difference has come in new supply. Roughly 85% of the 2 million new apartments this cycle have come to major markets, and the majority of those new units opened at luxury price points...

Of the nearly 555,000 apartments currently underway in the country, about 87% are rising in major markets.