While economists debate the direction of inflation, one thing remains crystal clear – rent prices keep climbing. The national median rent hit $1,607 in February 2025, marking a 0.4% increase from the previous year. That’s another $10 tacked onto January’s already painful $1,597. Fun times.
The real culprits? It’s a perfect storm of market forces and corporate greed. Over half of landlords blame market demand for their rent hikes, but there’s more to the story. Private equity firms have swooped in like vultures, snatching up rental properties and implementing fancy algorithmic pricing software to squeeze every possible dollar from tenants. These investment firms now control over half of the top 35 apartment building owners. Shocking? Not really.
Corporate landlords hide behind market forces while algorithms and private equity maximize profits at renters’ expense.
The numbers tell a brutal tale. Since the pandemic began, rents have soared 33.4%. That’s forcing four out of ten renters to fork over more than 30% of their income just to keep a roof over their heads. With the current homeownership rate at 65.6%, many Americans are stuck in an endless cycle of renting. The typical asking rent across the country now stands at $1,980 per month.
The average renter is now paying $257 more per month than in January 2020. Meanwhile, wages can’t keep up – rent has been rising 1.5 times faster than paychecks since 2019.
Don’t expect relief anytime soon. Construction starts are plummeting, with only 63,000 units begun in Q1 2024. By 2026, completions will barely hit 250,000 units – less than half of 2023’s numbers. The market’s shifting from too many apartments to too few, and guess who’ll pay the price?
Some cities are fighting back with rent control and stabilization measures, but it’s a drop in the bucket. Only 11% of renters have rent control protections, while 34% benefit from rent stabilization. The rest? They’re left to the mercy of the market.
People are doubling up with roommates, moving back home, or sacrificing location just to make ends meet. Welcome to the new normal – where the rent is too damn high, and it’s only getting higher.
