The State of Rent: Housing Affordability Trends Across the U.S.

Other notable increases include:

Insights:

• None of these ten states have rent control at the state level, allowing landlords to raise rents without any caps as long as they comply with local ordinances and notice requirements.
• Arizona has one of the fastest-growing populations in the country—especially among retirees—while also facing a significant housing shortage. This combination is driving up demand. Several large companies have relocated their headquarters to Arizona in recent years, including Dutch Bros, DoorDash, and Comtech, further adding to this pressure.
• Tennessee’s strong economic and job growth, favorable business climate, and low taxes are attracting more people to the state, driving demand for housing and creating greater competition.
• New Mexico has become an attractive alternative for people relocating from high-cost states like California, but housing shortages—particularly in rural parts of the state—remain a major issue. Growth in non-traditional sectors like renewable energy and defense contracting have contributed to job growth and demand for housing.
• A recent construction boom in Georgia added thousands of new units in the metro Atlanta area, but rents are still trending upward as inventory is absorbed. One study suggests that large corporations own a significant portion of the state’s single-family homes, and this concentration of ownership contributes to rising rents.
• Maryland’s proximity to Washington D.C., its strong job market and economic growth, and a significant number of affluent suburbs attract high-income residents, all driving demand for housing in a state with limited land for new construction.
• South Carolina is attracting a large retirement and remote worker population, increasing demand in both urban and rural areas. Similarly, states like Idaho and Montana have become popular relocation and recreation destinations, further intensifying pressure on rental markets.

Minnesota experienced a 34% decrease in the average rent paid by tenants over the past five years.

Insights:

• Minnesota is undergoing major land use reforms aimed at increasing housing supply and reducing housing costs by promoting diverse housing options. The Minneapolis 2040 plan, implemented in 2020, eliminated single-family zoning in certain areas to allow for higher-density housing development, and the proposed “Yes to Homes” bill suggests easing zoning restrictions, streamlining apartment construction, and increasing availability of accessory dwellings, townhomes, and duplexes.
• Preliminary data shows rising rents in Minnesota in Q1 2025, but averages are still well below levels seen before land use reform legislation introduced in 2020.

These states experienced the smallest changes in the average rent paid by tenants over the past five years, indicating a potential shift toward stabilization. This suggests that while affordability challenges persist in many regions, some states are seeing a slowdown—or even a reversal—of rapid growth in rental prices.

Insights:

• Following the devastation of hurricanes like Katrina and Ida, Louisiana’s rental market experienced significant disruptions and slower economic growth compared to other states. As recovery and reconstruction efforts add new housing, the market is finding more balance, which can lead to stabilization in rent prices. An increase in rental vacancy rates also contributes to stabilization as landlords compete to maintain occupancy and fill vacant units.
• Several municipalities throughout New York have implemented rent control or rent stabilization systems intended to protect tenants from excessive rent increases and evictions. These measures can often positively impact affordability in high-demand areas. The exodus of residents during the pandemic temporarily reduced rental demand, and as the city recovers and demand returns, rent prices are gradually stabilizing.

These states experienced the most dramatic changes in average rent paid by tenants from 2019 to 2022, reflecting the pandemic’s impact on housing demand, affordability, and migration trends:

• California, Florida, and Hawaii also experienced significant rent spikes during the pandemic, driven by shifting migration patterns and increased housing demand as remote work allowed Americans to seek out suburban areas with warmer climates.
• In contrast, Connecticut was one of the only states to see a sharp decline in rent during the early stages of the pandemic (-$181 from 2019 to 2021), followed by a dramatic rebound the next year (+$303 from 2021 to 2022). This is likely a result of residents fleeing densely populated areas like New York City for less expensive, less crowded environments but then returning to urban areas post-pandemic. This volatility underscores how external economic factors and demand shifts can drastically impact rental prices over short periods.

Key Takeaways for Tenants and Landlords

Implications & Advice for Tenants

Rent prices have fluctuated differently across the country—some states saw sharp price increases, while others have started to see signs of stabilization or even decline. Prospective renters should carefully research local market conditions to make informed decisions before committing to a lease. Affordability remains a growing challenge, but tenants may find greater flexibility by considering less expensive suburban or rural areas—though these markets may also bring increased competition. Tenants will find the highest costs, fewest available options, and most intense competition in regions with limited new housing development.

• Prioritize a positive landlord-tenant relationship — Landlords are more likely to offer discounts or incentives for lease renewals to great tenants. Turnover can be costly, so building a strong relationship with your landlord and being a reliable, rule-abiding tenant can increase the likelihood of your landlord working with you on favorable terms.
• Report maintenance issues immediately — Rent increases happen as the cost of property upkeep increases. Renters who address maintenance issues early and before they lead to extensive damages can minimize the overall cost burden on landlords to maintain the property.
• Negotiate your lease terms — Tenants always have the option to negotiate the terms of their lease agreement—for reduced rent, shorter or longer leases, or added perks like parking, updated appliances or pet accommodations. Before signing any lease, take extra time to carefully review all terms and conditions, especially those related to rent increases, renewal clauses and additional fees.

Implications & Advice for Landlords

Landlords in high-demand areas may experience greater profitability but should prioritize tenant retention strategies to minimize turnover and avoid vacancies. In areas where rent prices are stabilizing or declining, landlords may need to adapt by offering more competitive pricing or added amenities to attract and retain tenants. Landlords should expect to continue navigating increased maintenance and operating costs due to inflation and supply chain disruptions, making flexibility in pricing adjustments or other incentives essential to stay competitive.

• Small but regular rent increases are key — Raising rents in small increments year over year can help meet inflation demands over time while improving affordability for existing tenants.
• Incentivize long-term tenants — Turnover and vacancies will have the biggest impact on your bottom line, and these vacancy periods can be longer in a challenging market for renters. Consider offering incentives like discounted rent, free parking, or amenity upgrades for tenants who commit to longer lease terms.
• Stay informed on local laws and regulations — Stay up-to-date on any local or statewide regulations covering rent control, evictions, and other tenant rights to make sure your practices stay compliant. Familiarize yourself with the differences between rent control and rent stabilization, and be transparent about any rent increases at your properties with clear and advance notice. Being upfront about the need for rent increases can often help tenants better understand and accept the change.

Rental Market Trends to Watch in 2025

• Slower rent growth: Preliminary data from 2025 indicates that average rents continue to trend upward, but at a slower pace than the past five years. Factors like higher interest rates, inflation, and tighter consumer budgets could contribute to slower rent growth.
• Local market variations: Some states, like North Dakota and New Hampshire, have seen declines in average rent paid in Q1, though it’s still too early to determine whether these trends will stabilize or rise as the year progresses. These declines may be driven by unique regional factors and may not be representative of broader national trends, or they may signal market corrections after rapid growth in recent years.
• High demand in high-growth states: States like Arizona, California, Hawaii, and Delaware are still experiencing significant rent increases—not surprising in markets with growing populations and economic opportunities but limited housing supplies.
• Ongoing affordability challenges: Although the rate of rent growth may slow down, rental prices are still rising and affordability remains a crucial concern in many parts of the country—especially in major metro areas.

Climate risks will reshape rental markets The increasing frequency and severity of natural disasters will continue reshaping the rental market in 2025. Investors are already retreating from high-risk areas like Florida, Texas and California as hurricanes intensify in the East and wildfires escalate in the West, impacting insurance, financing and property values. Higher operating costs in vulnerable areas will require strategic risk management for landlords, though more risk-tolerant investors may find new opportunities. Tenants could see increased availability and lower rents but must weigh affordability against the risks of living in disaster-prone areas.

Alternative housing will gain momentum As affordability and flexibility remain top priorities for renters, alternative housing options will continue to gain popularity. Co-living agreements (renting our individual rooms in shared homes), build-to-rent developments (properties designed and built specifically for rental occupancy), and conversion projects (transforming commercial or institutional buildings into multi-family housing) will become more common across the country. These models offer cost-effective solutions for tenants and new revenue streams for landlords.

Landlord-tenant legislation will limit supply Increasing legislation impacting landlord-tenant laws makes some markets less attractive for real estate investors. Oregon serves as an example of a state where stringent regulations make profitability increasingly challenging for landlords in today’s economy, causing many landlords to exit the market and resulting in limited supply and higher rent prices. Similar trends in other states with tightening regulations could limit supply and further drive up rent prices—investors should keep a close eye on local and state regulations to assess profitability.

Supply chain constraints will continue to impact pricing Ongoing supply chain disruptions and availability of materials for new construction continue to push up costs and delay timelines for new housing. This lack of inventory will continue to strain the rental market, particularly in high-demand metro areas where demand outpaces supply. Landlords and developers will need to adapt by exploring alternative construction materials and methods, and tenants should anticipate increased rents in areas where construction bottlenecks persist.