Mortgage payments rise faster than rent increases in October

The average rent paid in the United States in October saw its biggest 12-month jump in at least two years, but outside of some hot metropolitan areas, the median mortgage payment increased further.

Rents rose an average of 13% year-on-year in October, while the median monthly expenditure associated with a home loan with a 5% down payment rose 17%, according to the online real estate brokerage firm. Redfin. On a consecutive monthly basis, mortgage payments increased 3.2% and rents increased only 0.4%.

“Growth rates in mortgage payments and rents had converged, but a slight increase in mortgage rates and house prices caused an acceleration in the growth of mortgage payments from September to October, ”Redfin said in a press release.

However, the median mortgage payment of $ 1,533 is still lower than the average rent ($ 1,858). And rents have grown faster than mortgage payments in 29 of the 50 largest metropolitan areas in the United States. West Palm Beach, Fort Lauderdale and Miami, Florida saw the largest rent increase at 36%, followed by Seattle, Washington and Jacksonville, Florida at 32%. Five other subways also saw rent increases of over 30%.

“The skyrocketing rents in some of the top cities suggest that there is a housing shortage, not just homes for sale, ”said Daryl Fairweather, chief economist at Redfin, in a press release. “The ‘Build Back Better’ bill currently being debated by Congress contains $ 150 billion in affordable housing spending, which could at least begin to solve the problem, but the bottom line is that a lot more housing needs to be. built in the places that grow the most.

A few major subways have seen rent increases below the national average, including Chicago, Illinois, 11%; Pittsburgh, Pennsylvania, 7%; and San Francisco, California, 7%. One metropolitan area, St. Louis, Missouri, saw rents drop 4%.

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