Strong demand for rental units in 2018 has fueled price growth nationally with the average rent in the U.S. clocking in at $1,419 at the end of 2018, 3.1% more expensive than the previous year. Small cities were most affected by the rising prices, the top 3 highest y-o-y increases taking place in Odessa, TX, Midland, TX, and Reno, NV, where renters saw double-digit increases. As for the larger cities, people looking for cheaper apartments and smaller living costs, in general, leaned towards more affordable markets like Las Vegas and Phoenix, as alternatives for high-priced urban centers like New York, San Francisco, or Boston.
Renting in Philadelphia vs Pittsburgh – Comparative Overview
Somewhere in the middle on the affordability scale, rents in the two largest cities in Pennsylvania increased faster than the national average last year. The more expensive of the two, Philadelphia apartments are now 3.4% pricier than at the end of 2017 with an average rent of $1,565 per month, whereas the price of renting an apartment in Pittsburgh is catching up with a much faster 5.6% annual increase, reaching $1,212 per month at year end.
Despite the fact that Pittsburgh’s population is 5 times smaller than that of Philadelphia, the number of new units delivered in the two cities in 2017 was surprisingly close: roughly 1,400 in Pittsburgh and around 1,700 in Philadelphia. However, mid-year estimates for 2018 showed that the construction wave in Pittsburgh was settling, with only 700 units to be delivered, while in Philadelphia more than 2,800 new units were expected.
The renter-owner distribution for the two cities in 2017 was close—52% of Pittsburgh’s population is comprised of renters and 48% of owners, making the city of steel a renter-majority town, according to U.S. Census statistics. Meanwhile, in Philadelphia, the renter-owner ratio was the other way around. Although Philadelphia’s population is mostly homeowners, the construction of new rental units is still going up in response to strong demand. As for Pittsburgh, where the majority of the population chooses renting over homeownership, the slowdown in rental construction is partially to blame for the big rise in rent prices.
Renters in Pittsburgh earn more than those in Philadelphia, median income stats show. According to Census data, the renter population of Pittsburgh had an average income of around $30,100 per year in 2017, approximately $1,500 more than that in Philadelphia. This goes to show that Philadelphians are more rent burdened than their distant neighbors in Pittsburgh, having to cover the $1,565 cost of rent.
To compare the rental market in Philadelphia and Pittsburgh with other markets in the U.S., read the full report here.
RENTCafe is a nationwide apartment search website that enables renters to easily find apartments and houses for rent throughout the United States.
To compile this report, RENTCafe’s research team analyzed rent data across the 252 largest cities in the US. The report is exclusively based on apartment data related to buildings containing 50 or more units. Our report includes cities with populations over 100,000 and a rental stock of at least 2,900 apartments in 50+ unit buildings.
In this report, large cities are cities with a population of 600,000 people or more, mid-sized cities are cities with a population between 300,000 and 600,000, and small cities are cities with a population of less than 300,000.
Population and income data was sourced from the most recent U.S. Census Bureau estimates.
Rent data was provided by Yardi Matrix, a business development and asset management tool for brokers, sponsors, banks and equity sources underwriting investments in the multifamily, office, industrial and self-storage sectors. Rental rate coverage is for Market Rate properties only. Fully Affordable properties are not included in the Yardi Matrix rental surveys and are not reported in rental rate averages.