Report: Denver's average rent now more than the median mortgage payment
(The Center Square) – Denver’s average rent is now greater than the city’s median mortgage payment, according to the latest monthly market data from Seattle-based real estate company Redfin.
According to the data, Denver’s average rent increased 19% year-over-year in October to $2,533 per month. For comparison, a homebuyer who purchased a home with a 5% down payment is making a medium mortgage payment of $2,143 per month, a 16% increase from last year.
The average rent in the 50 largest metropolitan areas surveyed by Redfin increased by an average of 13% to more than $1,800.
Twelve of the 50 metros surveyed saw their rents increase by more than 30%. Miami, Fort Lauderdale, and West Palm Beach, Florida led the way at a staggering 35.8% annualized increase.
Only one metro area saw its average rent decline: St. Louis, Missouri.
While the news may be good for some landlords, Redfin’s chief economist Daryl Fairweather argued that the rent increase could add to the inflation woes many businesses are feeling.
“Employees facing higher rents are likely to demand higher compensation from their employers, which could in turn lead to even more inflation down the line,” Fairweather said. “Skyrocketing rents in some of the most desirable cities suggest that there is an overall shortage of homes, and not just of homes for sale.”
Renters are not the only ones feeling the inflation concerns either. Homeowners have seen their average mortgage payments increase 17% since October 2020, Redfin data shows.
Meanwhile, mortgage payments increased 3.2% month-over-month, the largest jump since April, the data shows. This is also more than double the increase homeowners saw during the same time in 2019.
One way to quell the growing cost of living is by building more housing supply, Fairweather said.
“The bottom line is that a lot more housing needs to be built in the places that are growing the most," he said.