Most expensive rental markets
New York rents far surpass all other U.S. markets. California and New England cities vie for second place.
NEW YORK (CNNMoney.com) -- New York City - and not just Manhattan - has by far the highest rents of any of the 52 major apartment rental markets around the nation, according to a report published Wednesday.
At year's end, the average estimated monthly rent for all of New York's five boroughs was $2,553, according to Marcus & Millichap, a real estate investment broker based in California. The average for the second most expensive city, San Francisco, was a comparative fire sale at $1,685.
New Yorkers - and everyone else - shouldn't expect much better in 2007. Marcus & Millichap forecasts a 6.5 percent rise in the asking price of rents during the year in the New York and a 4.3 percent rise nationally.
In the three years that will end December 31, 2007, the company forecasts that the average rent in the United States will have increased by 14 percent, far faster that the rate of inflation.
Rents are up, in part, because of the slowdown in the housing markets. That has has kept potential home buyers in the rental market
The company also attributes the strength of the rental markets to the strong economy and job growth.
But the housing slowdown also led to the return of condos to the rental pool, according to the report. That has expanded the supply, which helped dampen what would otherwise be even larger rent increases.
Rental market, as measured by vacancy rates were weakest in Texas, where 10.1 percent of Houston's rental inventory was vacant and 9.3 percent of Dallas/Ft. Worth's.
New York City (2.7 percent) and Los Angeles (2.8 percent) reported vanishingly small vacancy rates.
Besides New York and San Francisco, other expensive areas include Boston, where rents average $1,632, New Haven ($1,485) and Orange County, Calif. ($1,458).
Bargains abounded in the Southwest and Midwest. In Tucson, the average rental apartment costs just $615. Columbus, Ohio ($642) and Indianapolis ($643) also boast bargains for renters.
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