Fresno tops California, U.S. in apartment rent increases. What’s driving leases higher?
Fresno experienced the largest month-over-month percentage increase in median apartment rents among the nation’s 100 largest cities between March and April, according to a new nationwide analysis of lease data.
ApartmentList.com reported that the median rent for market-rate apartments across all types of units increased by 4.4% between March and April, climbing from $1,309 in March to $1,367 in April.
Over the course of the past year, Fresno’s median monthly rent has risen by almost 15% — or $178 per month — compared to April 2021 when the figure was $1,189.
“This is the second straight month that the city has seen rent increases after a decline in February,” the ApartmentList analysis reported. While the month-over-month increase was the highest among the largest U.S. cities in the report, “Fresno’s year-over-year rent growth lags (behind) the state average of 15.9%, as well as the national average of 16.3%.
“As rents have increased sharply in Fresno, a few large cities nationwide have seen rents grow more modestly,” the report continued. “Fresno is still more affordable than most large cities across the country.”
The median rent for a one-bedroom apartment in Fresno in April was $1,080 per month, while two-bedroom units had a median price of $1,326 per month.
The median marks the price at which half of apartments were rented for more money and half for less.
Elsewhere in California
In contrast to Fresno, median rents in California’s largest cities were considerably higher, despite lower percentage increases in rent rates between March and April:
- Los Angeles: $1,874 per month, 0.4% increase.
- San Diego: $2,279 per month, 1.3% increase.
- San Jose: $2,372 per month, 1.6% increase.
- San Francisco: $2,204 per month, 0.7% increase.
- Fresno: $1,367 per month, 4.4% increase.
- Sacramento: $1,651 per month, 0.2% increase.
- Long Beach: $1,655 per month, 0.3% increase.
- Oakland: $1,673 per month, 0.3% increase.
- Anaheim: $2,164 per month, 1.2% increase.
- Santa Ana: $2,105 per month, 0.6% increase.
What’s behind the increase?
In the Fresno market, both apartment rents and home prices have been climbing over the past two years of the COVID-19 pandemic.
And while new apartment complexes have opened up in different parts of Fresno, including more upscale developments, ApartmentList researchers say the rent increases here are being driven by lower vacancy rates and higher demand, rather than an increase in higher-end units that may skew calculations.
“What we measure are repeat transactions: the price changes that occur when apartments are leased multiple times over time,” Rob Warnock, a senior research associate, told The Fresno Bee. “This is the approach used by most housing economists because it is unbiased by changes to the market itself.”
“So it’s not that new, expensive construction is driving up average prices,” he added. “It’s that tight market conditions … are providing landlords the opportunity to raise prices and seek out higher-paying tenants, even in less-expensive segments of the market.”
Fresno’s apartment vacancy rates have hovered from 1 to 2 percent over the past year, Warnock said. “So renters who are apartment hunting right now have very little leverage.”
This story was originally published April 30, 2022 at 5:00 AM.
