As renting is becoming more and more popular in the US, renters are now moving out of the confines of metropolitan areas with their high rise buildings and fast pace of life and into single-family homes in the suburbs.
According to a report from New York University’s Furman Center, there were almost 22 million more people in rented accommodation in the US in 2014 than there were in 2006. The report goes on to conclude that the majority of this growth was due to an increase in suburban renters. In major cities, the number of renters increased by nine million between 2006 and 2014. By comparison, the number of renters in suburban areas increased by over 12 million over the same period.
According to analysts, lower and middle income residents are being pushed out of the increasingly expensive downtown areas and forced into the suburbs. Laura Bailey, managing vice president of community finance at Capital One commented: “The story really is that the pressure in the market is growing. It may have started in the cities, but it’s moving further out”. This is evidenced by the fact that the median rental costs in principal cities, when adjusted for inflation, grew 5% from 2006 to 2014, compared with 2% for the surrounding suburbs.
In some metro areas the difference in rental costs was even more noticeable. In Washington, D.C., the median rent in the city, adjusted for inflation, grew by 27% from 2006 to 2014, while in the suburbs it only grew by 8%. In New York, the median rent in the city grew by 15%, compared with only 4% in the suburbs.
The authors of the report say that the growth in suburban renting underscores the need to build more housing in a wide range of different areas and not just pricey downtown areas of large metros. Ingrid Gould Ellen, faculty director of the NYU Furman Center commented: “As demand for renting continues…the suburbs need to make building rental housing easier”.