Here’s How Much the Average American Spends on Rent Now Compared to 5 Years Ago
The cost of housing has long been a key economic indicator, reflecting not only the state of the real estate market but also the financial well-being of everyday Americans. In this article, we delve into the evolving landscape of rental costs across the United States over the past five years. GOBankingRates used Apartment List rental data to find the change in rent on the national, regional and state levels over the last five years.
From the affordability of the Midwest to the high-rent districts of the Northeast and the Western states, average rent prices have increased everywhere. Join us as we uncover the trends and shifts in the housing market, shedding light on how much the average American now spends on rent compared to a half-decade ago.
For this piece, GOBankingRates used ApartmentList rental data to find the change in rent on the national, regional and state levels over the last five years. In August 2018, the average rent nationwide was $1,099. Over the five-year period, it increased by almost 25%. The national average rent is now $1,371.
Here’s a closer look at some of the other changes.
The Midwest Has the Lowest Average Rents
In August 2018, rent was $872, $227 less than the national average. Now in August 2023, rent is $1,074, a 23% increase. That averages out to a modest 4.6% rent increase per year. This was the region with the lowest increase overall, and the only region with an increase of less than 25%. The Midwest is the least expensive part of the U.S. to live in, just like it was in 2018.
Indiana was the worst offender in the Midwest. Rents there increased by almost 34%. Minnesota saw very little increase, with rents only going from $1,016 to $1,114, a close to 10% increase. Out of the whole country, North Dakota is the least expensive state to live in. Rent there is only $880, and it only increased by 4% over the five-year period. Rents in Iowa and South Dakota have likewise managed to stay under $1,000.
The Northeast Has the Highest Average Rents
Back in August 2018, the monthly rent in the Northeast stood at $1,240, surpassing the national average by $141. Fast forward to August 2023, and the rent has climbed to $1,590, marking a substantial 28% increase. Rent in the Northeast is now $219 more than the national average. In 2018, the Northeast was the most expensive part of the U.S. to live in, and that continues to be the case today.
Of these four regions, the Northeast experienced the worst rental increase overall. Delaware was the biggest offender here, with an increase of 47%. Maine and New Hampshire were also big contributing factors, with increases of 43% and 41%, respectively. Washington, D.C. has one of the highest rents in the country, at $1,901, but that only increased by almost 5% over the last five years.
The South’s Rental Landscape
In August 2018, rent in the South was $1,032, $67 less than the national average. Now in August 2023, rent is $1,313, a 27% increase, but that’s still just a little lower than the national average of $1,371.
Rent in Florida increased by almost 37% over this period, from $1,232 to $1,687. South Carolina, Mississippi and Arkansas all increased by more than 34% each. Rents increased the least in Louisiana, where they only went up by 14%. Despite increases, West Virginia and Kentucky’s rents have stayed under $1,000.
The Most Expensive States Are Out West
In 2018, the average rent in the Western U.S. was $1,178, which was $79 higher than the national average. However, come August 2023, rent here has surged to $1,496, representing a significant increase of 27%.
California and Hawaii have the highest overall rents in the country, at $1,958 and $2,418, respectively. But they saw smaller increases compared to the nation as a whole. California went up by almost 17%, and Hawaii went up by about 19%.
New Mexico saw the biggest jump across the whole nation. Rents there went from $843 to $1,295, a staggering 54% increase. Arizona also contributed greatly to increases in this region, with a 45% increase.
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