Dear Mr. Fed Chair Powell Sir, Rents Are Blowing Out and People are Hurting

In 34 of the largest 100 cities, rents spiked by 15%-28%. Tenants get to pay for your reckless monetary policies that made the wealthy far wealthier.

By Wolf Richter for WOLF STREET.

In January, the median asking rent for one-bedroom apartments increased by 10% or more in 56 of the 100 largest cities in the US, compared to a year earlier. In 34 of the 100 largest cities, one-bedroom rents spiked by 15% or more. In 20 of those cities, rents spiked by 20% or more, and in 11 of them, rents spiked by 25% or more. Many of the cities with the largest year-over-year rent spikes are medium-size cities with more modest incomes.

At the top is Fresno, CA, where the median asking rent for one-bedroom apartments in January skyrocketed by 28% in 12 months, and by 41% in two years, from $1,000 in January 2020 to $1,410 in January 2022, according to data from Zumper’s National Rent Report. Rent increases like this are nuts:

This is a serious freaking problem, Mr. Chair Powell Sir. These renters are not wealthy people who made millions or billions of dollars thanks to your radical monetary policies. These are the working stiffs that now get to pay for your policies that made the already wealthy far wealthier.

In the US overall, across the 100 largest markets, the median asking rent for one-bedroom apartments jumped by 12% year-over-year, according to Zumper’s National Index. The index for two-bedroom rents jumped by 14%.

“Asking rents” are advertised rents for apartments listed at various rental listing services, including Multiple Listing Service. They show the current pricing of the market, like a price tag. They’ don’t include rents that tenants have been paying for months or years. Zumper’s data is limited to apartments in multifamily buildings and do not include single-family houses for rent. “Median” means that half of the apartments are listed at higher rents, and half are listed at lower rents.

The 34 cities were rents spiked by 15% to 28% year-over-year.

Can you even imagine a 20% or 25% increase in rent, Mr. Chair Powell Sir, when your pay goes up a glorious 6%, what that would require of your belt-tightening strategies?

These are the 34 cities, of the largest 100 cities, were the median asking rent for 1-BR apartments spiked by 15% to 28% year-over-year. Mr. Chairman Sir, these are massive crushing rent increases that are now hitting a lot of people who are struggling to pay for them. If your pay goes up 6% and your rent goes up 25%, Mr. Chairman Sir, you’re screwed, Sir. But that’s what is happening now:

Rents didn’t spike in all cities.

In San Francisco, the median asking rent rose 6% year-over-year in January, to $2,850, but has been relatively stable for the past 8 months – and is still down by 23% from the peak in June 2019. But that peak in 2019, at $3,720, was totally crazy. It was locally called the “Housing Crisis,” because middle-class San Franciscans couldn’t afford to rent a one-bedroom apartment. So this drop in rents brought some much needed relief to renters, and to the rest of the local economy because it leaves renters a little bit of money to spend on other things:

In Newark, rents plunged 25% year-over-year, but just back to normal from the ridiculous peak a year ago when landlords got drunk with the notion that Manhattanites who could work from home would flee to Newark, and so they jacked up their asking prices to fleece those Manhattanites, and it didn’t work. Now rents are back where they’d been in 2019.

Here are the only 8 cities of the 100 largest cities were rents fell, including our special case, Newark:

The largest 100 rental markets.

Below are the largest 100 rental markets that Zumper tracks, with 1-BR and 2-BR median asking rents in January, and year-over-year percent changes, in order of the price of 1-BR rents (if your smartphone clips the 6-column table on the right, hold your device in landscape position):

And just in case you missed it, Mr. Chair Powell Sir, here is the result of what you have accomplished with your radical monetary policies that tenants (among others) are now paying for: The biggest fastest  wealth disparity ever, as the richest…