A new study claims that skyrocketing rents on the west side of the Hudson River have caused a swath of northern New Jersey to become one of the hottest rental markets in the country.
RentCafe, a California-based company that tracks real estate trends, recently released their 2022 year-end report. The company analyzed apartment data from Yardi Systems in 135 markets spanning January through August that included large-scale multifamily properties of at least 50 units, with fully affordable multifamily properties excluded.
The study then took into account occupancy rates, the number of renters applying for an available unit, vacancy days, the percentage of renewed leases, and the share of new apartments to hit the market in each of those markets. RentCafe then calculated a Rental Competitivity Index (RCI) for each locale, with a maximum score of 130.
North Jersey, as defined in the report, ended the year as the country’s fifth most competitive rental market, snagging an RCI score of 107.5. The region’s highest rankings came from a high lease renewal rate of 74.3% and a solid rental demand, with 21 prospective renters for every one available unit.
Apartments in North Jersey stayed on the market for an average of 32 days and had an occupancy rate of 97.2%. The market had a low rate of vacant apartments despite a 2.1% increase in the total number of new apartments constructed, which was the sixth-largest growth in supply nationwide.
A separate study from real estate marketplace Zumper pointed out that Jersey City, Union City, and West New York are seeing rents dramatically rise. Jersey City in particular saw median rent for a one-bedroom jump by 48.7% year-over-year, driven by people being priced out of New York City.
Speaking of the Big Apple, the RentCafe study gave Manhattan a 54.6 RCI score. Apartments in the city’s most densely populated borough stay on the market for an average of 36 days and were about 95% occupied over the last year.
Six other metros in the Northeast were among the top 20 most in-demand rental markets of 2022 including Central Jersey, which snatched the seventh spot with an RCI score of 96.8.
Florida’s Miami-Dade County was America’s most competitive rental market this year according to the report, with the Sunshine State welcoming over 220,000 new residents between 2020 and 2021 according to U.S. Census Bureau.
Nationwide occupancy rates clocked in at 95.3%, with apartments staying on the market for an average of 32 days. RentCafe’s study found that 44 million American households are living in rental homes, which is the highest mark in over half a century.