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'Everyone should expect a rise in rent': The 5 U.S. cities where rent has increased most this summer

"One of the simple reasons that rent has increased is increased demand."

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After a stagnant year of Covid, rent prices have bounced back in a big way. The median monthly cost for a one-bedroom apartment has jumped 5% compared to this time last year, according to Zumper's June National Rent Report. Two-bedroom rents are up more than 6%. Even major cities that saw precipitous drops in rent last year, such as San Francisco, are back on the upswing.

"Everyone should expect a rise in rent and other costs," says Darren Nix, the founder of landlord insurance company Steadily.

"One of the simple reasons that rent has increased is increased demand," Nix explains. "Younger generations are trying to live in cities to start their lives and work. Older generations are selling their homes with the housing boom, and trying to rent. Many people in between have moved due to the pandemic."

Here are the 5 U.S. cities where rents increased most from May to June, according to Zumper: 

Irving, Texas

Median one-bedroom rent: $1,180
Month-over-month one-bedroom rent increase: 5.4%
Median two-bedroom rent: $1,580
Month-over-month two-bedroom rent increase: 5.3%

San Francisco, California

Median one-bedroom rent: $2,790
Month-over-month one-bedroom rent increase: 5.3%
Median two-bedroom rent: $3,690
Month-over-month two-bedroom rent increase: 2.5% 

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Madison, Wisconsin

Median one-bedroom rent: $1,200
Month-over-month one-bedroom rent increase: 5.3%
Median two-bedroom rent: $1,450
Month-over-month two-bedroom rent increase: 0%

Des Moines, Iowa

Median one-bedroom rent: $1,010
Month-over-month one-bedroom rent increase: 5.2%
Median two-bedroom rent: $1,060
Month-over-month two-bedroom rent increase: 5%

Reno, Nevada

Median one-bedroom rent: $1,210
Month-over-month one-bedroom rent increase: 5.2%
Median two-bedroom rent: $1,550
Month-over-month two-bedroom rent increase: 0%

Major cities are making a comeback

The pandemic pushed many Americans to move. Millions of people relocated in 2020, and while many of them flocked to the suburbs in search of more space, some are starting to return to big cities as offices reopen.

"People left big cities due to fear of Covid, but found out they could come back a lot faster than expected," says Eric Nerhood, the president and owner of Premier Property Buyers. "Rents [have] increased dramatically due to the demand."

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The eight most expensive cities for renters — New York, San Francisco, Los Angeles, Boston, Oakland, San Jose, Washington, D.C., and Seattle — haven't seen prices return to they were before Covid. But they're starting to creep back up: While rents were down 20% year-over-year in January 2021, they're now down just 15.6% compared to January 2020.

In the second tier of pricey cities — San Diego, Miami, Chicago, Fort Lauderdale, Santa Ana, Long Beach, Anaheim, and Honolulu — rents are actually up 1.2% compared to January 2020. That's a sharp increase from this March, when they were down 8.7% compared to the previous January.

Of the 100 cities studied by Zumper, only 24 are seeing lower rents compared to before the pandemic. And of those 24, half are down by less than 5%.

Suburbs aren't immune to rent increases

The suburbs saw a rental demand surge of their own, as people with the flexibility to work remotely aimed to get more space for their money.

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The Dallas-Fort Worth area is a good example. Its surrounding suburbs have experienced some of the country's largest rises in rent since the beginning of the pandemic. For a one-bedroom apartment, up-and-coming suburbs including Frisco, McKinney, and Plano saw year-over-year rent increases of 7.8%, 10%, and 10.6%, respectively.

Even older, less trendy parts of the Dallas Metroplex saw surges: Rents in Richardson jumped more than 14%, while in Euless, prices are up more than 15%.

How to prepare for a rent hike

Big increases in rent have big consequences, especially for those still recovering financially from the pandemic. Rising rents are a major contributor to inflation, and continued increases could curb the nation's economic growth.

Even more troubling is the potential for eviction as tenants struggle to cover higher rents. About 2 in 5 renters in a recent Rent.com poll said they couldn't handle a $150 monthly rent increase. Meanwhile, nearly half of respondents in a U.S. Census Bureau poll of 7.4 million adult renters said it's "very" or "somewhat" likely they'll be evicted by September.

But there are ways to save. "There is always room for more negotiation," Lauren Riefflin, home trends expert at StreetEasy, recently told Grow. For example, a landlord might offer a better rate if you are willing to sign a longer-term lease or able to pay more of the rent upfront.

You could also leverage your skills, says Nix. "With contractors backlogged, many landlords are looking for handy people. If you have skills including lawn care or pest control, you could offer your services for decreased rent. You could also try to sell your skills or find ways to downsize your belongings."

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