As housing prices have boomed, so have the price of apartments — in most places. People who have fled big cities like New York and San Francisco en mass, due partially to the COVID-19 pandemic, have driven rents down for the first time in decades. However, rents in these cities remain high compared to national averages.
Many people weigh whether it is better to rent a house or apartment rather than owning one. Homeowners can build equity, unless home prices fall as they did in 2007 and 2008. Homeowners also have the expenses of property taxes, and they have to pay for their own repairs. Apartment renters can move quickly. Most expenses belong to the landlord.
A new study shows that whether people decide to rent or buy, renting is more expensive in most cities. A study of the 335 largest cities by Hire a Helper showed that “In 333 out of 335 cities studied, homeowners spend less of their income on accommodation than renters.” The research looked at prices and disposable income. Typical homeowners spend 20% of their income on housing. The typical renter nationwide spends 32%.
The study points out that California has nine of the top 10 cities based on monthly rentals. This should be no surprise. Many of these cities also have the highest median income in America, driven largely by the tech industry. Two large cities are on this list: San Francisco and San Jose.
The city at the top of the list in terms of average monthly rental of the 355 metros considered is Sunnyvale, California, at $2,600.
According to the Census Bureau, Sunnyvale has a population of 152,703. While 46% of the city’s population is Asian, almost 31% are white and nearly 17% are Latino. The median household income is extremely high at $140,631. The 5.5% poverty rate is half the national number. One reason rents are high in Sunnyvale is that the population is rich by American standards.