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Comparing Rent / Price Ratios in Major Metros

October 15, 2018

Compare Rental Property R/P Ratios

2018 was an interesting year for owners and PM’s. Major hurricanes, flooding, fires, and economic turmoil, kept property investors glued to market reports to help them decide on where to invest.

We thought we’d take a new look at the most recent data from Zillow and Zumper regarding price to rent ratios in major metros to discover buying opportunities for you to drill down on. If you’re an investor/property manager, please offer your thoughts in comments.

The chart below is a snapshot in time, and we should remember that employment and rent price trends are also active and changing.  Rents are trending upward in many markets in the last few months.

Rental Price Stats from Zumper

According to a report from Zumper, San Francisco is holding onto its crown of highest rental prices in the US. That’s ahead of other superheated rental markets in New York, Los Angeles, San Jose, and San Diego.

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It seems the cities with highest rents are in California, however when you consider prices, cap rates, taxes, and rent profits, other states and cities may offer better ROI including better rental yields.

If there was a supposed downturn in California due to the loss of free trade, it’s not showing up in apartment rents here

Zumper’s national rent report reveals New York, San Jose and Los Angeles are well behind San Francisco in rent prices. Surprisingly, San Diego is ranked number 10 at $1810 per month. Their September 2018 data indicates the highest rents for a 1 bedroom apartment are a pricey $3,395 per month in South Beach, $3740 in Pacific Heights, and and $3650 in Telegraph Hill and Hayes Valley.

Zumper says 2 bedroom rents across the nation fell .3% last month yet are still up 3% YoY.

So we know which cities have the highest potential rental rates and they’re rising again. These stats below don’t necessarily reflect the complete picture for high volume, corporate investment returns in the multifamily market, but rather small to medium investors buying existing rental properties.

Price to Rent Ratios for Most Major Metros

The price to ratio is a key stat for property investors who are looking for the best properties in the best cities. See our posts on the Phoenix market, San Jose housing market, San Francisco housing, and Las Vegas housing market of recent. Here’s the most recent rent price ratios below.

The big surprise is San Jose, CA. Probably one more reason why the San Jose housing market is so hot.

Major Metro Average Rent Average Price Rent/Price Ratio
San Jose 2507 675000 22
San Diego 1895 324300 14
Seattle 1909 320000 14
Los Angeles 2450 406900 14
Detroit 600 99000 14
Nashville 1340 214200 13
San Francisco 3670 586500 13
Denver 1534 242100 13
Austin 1220 191500 13
Boston 2395 352600 12
Washington 2172 309500 12
Columbus 759 106900 12
Las Vegas 950 124600 11
Milwaukee 900 113200 10
Atlanta 1475 175000 10
Charlotte 1169 131800 9
Minneapolis 1450 158500 9
Memphis 825 86200 9
Jacksonville 995 95000 8
Dallas 1275 120100 8
Philadelphia 1550 140100 8
San Antonio 900 78700 7
Tampa 1134 97400 7
New York/ New Jersey 2875 234000 7
Houston 1215 92300 6
Miami 1800 128500 6
Chicago 1500 100300 6
Pittsburgh 1187 73900 5

 

Are you surprised at San Jose as the rent/price leader? If you read the post on San Jose’s housing market, you’ll see the intense interest in property there. The expectations are high for 2019.  San Jose and San Francisco are epicenters for tech startups including Proptech startups.

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Software Solutions that Fit Your Company

Have you discussed ManageCasa as your preferred property management software solution? Being on the cloud with its security, uptime and tenant friendly benefits will be even more important in 2019. Learn more about the advantages.

See also: Property Software | Accounting for PropertiesPropTech StartupsProperty Management Companies | Property Management Apps | Landlord Apps Adroid iOS | Apartments for Rent | Renters Insurance | Hawaii Housing Market2019 Rental Housing Market | Apartment Rent Prices USA |  Online Property Management Software | Renter Demographics | Tax Tips for Property Managers | Real Estate Portfolio Tips | Starting a Property Management Business | Tenant Screening | Increase Investment Property ROI | San Francisco Housing Forecast | Improve Property Cash Flow | Property Managers CaliforniaProperty Management Contractor Scams | Property Management Workload Tips | ManageCasa Property Management Solution

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