Miami Is Nation’s Hottest Renting Spot as Florida Shines Again This Rental Season

Although the very start of the year saw a pivot in the Northeast, Florida’s apartment market is once again the most competitive in the country. With its diverse and resilient economy, the fastest-growing state in the U.S. continues to interest renters who find the state an attractive place to live.

Transplants from the North are moving to the Sunshine State in search of jobs and better lifestyle, and this is showing in the local rental market’s competitiveness. To that extent, six out of the nation’s top 20 hottest renting hubs are located in Florida, including four that dominate the top half of the ranking.

Consequently, this rental season, our ranking includes even more Florida markets compared to the start of the year. Namely, Miami is reemerging as the nation’s most competitive rental market, surpassing North Jersey, which fell to second place. Similarly, Southwest Florida comes in third place and Broward County lands in fourth.

At the same time, some of the most competitive rental markets in the U.S. are seeing occupancy rates as high as 97% or lease renewal rates of 80%, while apartments are flying off the market in less than three weeks.

But what other options are there for renters looking for apartments that suit their needs as the search for new rentals is heating up?

To find out, RentCafe.com analyzed 137 markets in the U.S. where data was available to rank the nation’s hottest renting spots this season. Specifically, we used these five key indicators in terms of competitivity:

• the number of days apartments were vacant
• the percentage of apartments that were occupied
• how many renters applied for the same apartment
• the percentage of renters who renewed their leases
• the share of new apartments completed

Next, we calculated the Rental Competitivity Index (RCI) to measure how competitive the U.S. rental market is. This rental season, the national RCI score is 60, which means the apartment market is moderately competitive.

The U.S. rental market marches onward with caution amid economic uncertainties

The wave of new apartments completed in the last two years — coupled with economic uncertainties — has affected all metrics used in this competitivity report.

For example, at the national level, 94% of rental apartments are occupied this rental season. That’s slightly less than this time last year when the U.S. occupancy rate was a higher 95.1%.

Furthermore, vacant apartments are taking longer to fill this year, 43 days on average, with only nine prospective renters competing for each available unit. By comparison, last year, apartments were filled one week faster, and four more applicants were competing for the same rental.

Moreover, less than 60% of apartment dwellers signed lease renewals, as opposed to searching for a new home in the first months of 2023. Looking back one year ago, more renters renewed their leases (65.6%) because they had fewer options to choose from at that time.

Out of the 137 markets analyzed, approximately 37% show signs of softening in at least four of the five relevant metrics in terms of competitivity. Most often we see a decrease in the share of lease renewals and a rise in the number of days vacant apartments stay on the market.

Miami reclaims its top spot as the nation’s hottest rental market

Developers in Florida have been busy completing new apartments. However, this is still not enough to keep up with pent-up demand, which is why Florida markets are claiming the first spots on our list. With increasing tourism and business activity, Florida is experiencing a veritable rental boom.

For example, finding an apartment for rent in Miami — where the occupancy rate is at a spectacular 97.1% — can be a real challenge for most renters in the area. Here, apartments fly off the market within 33 days (10 days faster than the national average), and there are 24 applicants competing for each available unit. That’s almost three times the number of prospective renters per vacant unit at the national level.

Adding fuel to the fire, a whopping 71.8% of renters in Miami renewed their leases, even with a 0.9% uptick in the total number of new apartments. That said, with an RCI score of 120, Miami reclaims the top spot as the nation’s hottest rental market this rental season — after a short stint in second place at the very start of the year, when it ranked just behind North Jersey.

Likewise, the job market in the Miami metro area also continued to expand, with a growth rate of 3.5%. And, although this is slower than the previous year’s growth rate of 6%, it still outpaces the national rate of 2.7%.

Meanwhile, North Jersey is the nation’s second most competitive renting spot this rental season. With an RCI score of 117, this buzzing market in the Northeast offers renters a more reasonable cost of living close to Manhattan. Plus, many people living in places like Newark, Jersey City, Hoboken, Union City and Passaic benefit from New Jersey’s strong and diverse economy that attracts lots of techies and financiers, as well as health care and education workers.

Low-supply North Jersey has a high occupancy rate of 96.4%, especially as the number of rental apartments increased by a mere 0.3% in recent months. Accordingly, with very few options available, 70.9% of apartment dwellers decided not to move out.

Florida shines on as local and out-of-state renters fuel competition

All of Florida is sizzling with demand thanks to the high numbers of remote workers of all ages and ultra-wealthy newcomers (as well as many retirees) looking for tax breaks, sunshine and a more relaxed lifestyle.

This is particularly apparent in Southwest Florida, the third-most competitive rental market in the U.S. (RCI score 110). This area has been consistently receiving new residents looking to retire more comfortably or work remotely in warmer, more laid-back locations.

In fact, Naples recently ranked as the best city to live in in the U.S. thanks to a combination of factors including affordability, safety, healthcare, education, infrastructure and access to jobs. Other attractive places in Southwest Florida include Fort Myers, Cape Coral, Bradenton and Port Charlotte.

That said, less than 4% of rentals in this highly popular corner of Florida are currently available. Plus, even though recently completed apartments make up 0.9% of the area’s housing supply, that’s still far from meeting demand. As a result, more than two-thirds of renters renewed their leases. This led to 13 prospective renters competing for each vacant unit, which stayed on the market for 34 days, on average.

Another hotspot this rental season is Broward County, claiming fourth place (RCI score 108). Immediately north of Miami, this bustling area includes Fort Lauderdale, Pompano Beach and Hollywood. Here again, finding a rental apartment in this area is not easy, especially as the number of new apartments increased only marginally in recent months (0.12% uptick). As such, the occupancy rate of apartments for rent in Broward County is 95.5%.

Next, in addition to being a global tourist destination, Orlando also attracts a steady stream of job seekers in many sectors outside of the realm of tourism, including aerospace, health care and technology. But despite the healthy increase of 1.08% in new apartments completed recently, vacant apartments represent less than 5% of all units for rent. And, with two-thirds of apartment dwellers renewing their leases this rental season, there are 12 prospective renters, on average, applying for each available unit. As such, it takes a little more than a month for the average vacant rental apartment in Orlando to become occupied.

Tampa (RCI score 82) and Palm Beach County (RCI score 80) complete the list of highly competitive rental markets in Florida and nationwide, landing in 19th and 20th places, respectively.

Large Northeastern markets are also in high demand

The region’s economic opportunities, natural beauty, and cultural diversity make the Northeast an attractive place to live and work for renters.

Looking for an apartment for rent in Brooklyn, NY, is a good compromise for those who still want to live in the Big Apple, as well as newcomers from all corners of the country. Accordingly, Brooklyn is the ninth hottest rental market in the U.S. (RCI score 99).

But, with no new units completed recently, 61.5% of apartment dwellers renewed their leases and only 4% of the apartments here are available for both newcomers and existing renters. Therefore, it takes 43 days for a vacant unit to become occupied and there are 12 prospective renters competing for each available unit.

Suburban Philadelphia and Central Jersey are also very hot this rental season, mainly due to their location and affordability. More precisely, about 5% of all units are available in each market. And with high lease renewal rates of 75.6% and 83.3%, respectively, securing an apartment in these areas is quite difficult, even with the slight increase in new rentals.

Similarly, Bridgeport-New Haven and Greater Boston are both highly competitive. This is also reflected in their occupancy rates (95.5% and 95.4%, respectively) as more than half of renters in both markets renewed their leases amid modest progress in recently built apartments.

The Midwest lures renters in search of affordability, space

Rental apartments in the Midwest are also highly sought-after this rental season. Renting in this region makes it easier for would-be homebuyers to save money for a down payment without compromising on space and quality of life.

Leading in the Midwest, Omaha is the fifth hottest renting spot in the U.S., with an RCI score of 106. The area's attractiveness is largely due to a mix of urban amenities in suburban settings, good healthcare options, and a strong economy. Plus, more and more tech companies are opening shop or expanding their footprint here, including giants like Google and Facebook.

Meanwhile, faced with low supply and an influx of newcomers, less than 4% of the apartments for rent in Omaha are available. And with developers adding very few new units in recent months (0.5% uptick), almost two-thirds of renters here renewed their leases. Consequently, the average vacant apartment in Omaha fills very fast, within 34 days, on average, with 14 renters competing for it.

Suburban Chicago is another competitive rental market in the Midwest (RCI score 98). Including places like Evanston, Naperville, Oak Park, Elmhurst or Arlington Heights, renting in Suburban Chicago has all the perks of living near a large vibrant city like Chicago often at a lower cost.

However, with an occupancy rate of 95.3% due to insufficient new apartments in the area, 65.9% of renters opted not to move this rental season. As such, there are 14 applicants competing for each vacant unit, which gets filled within 42 days, on average.

Other large markets in the Midwest that made it into our top 20 for competitivity this rental season are Grand Rapids, MI (RCI score 103); Milwaukee, WI (RCI score 102); Kansas City, MO (RCI score 88); and Cincinnati (RCI score 86).

Orange County remains the most competitive renting spot in SoCal

In recent years, better job prospects in the expanding e-commerce sector have made many Angelenos ditch the big city for a slice of Orange County, where rents are easier on their wallets. But, so have lots of newcomers from other states, including Florida, Texas and New York.

Still, the low supply of housing is making it hard for apartment hunters to secure a rental in the area, which includes places like Irvine, Anaheim, Santa Ana, Costa Mesa, Newport Beach or Aliso Viejo. Thus, nearly 96% of apartments in the OC are occupied and almost 60% of apartment dwellers renewed their leases this rental season.

Hot on the heels of the OC is San Diego (RCI score 82), where renters are faced with similar market conditions this rental season — although vacant apartments here are filled faster, with slightly more renters competing for each available unit.

Moreover, developers in San Diego completed only marginally more apartments throughout the city, for an uptick of 0.17% in the total number of apartments. Even so, prospective renters here have limited options to choose from amid an occupancy rate of 95.9% and with almost half of the apartment dwellers renewing their leases.

Additionally, it’s worth noting here that Silicon Valley almost made it to the top 20 most competitive markets in our ranking, landing in 21st place. Nevertheless, Silicon Valley is the hottest rental market in Northern California this season, with very few new apartments opened recently. More precisely, the occupancy rate for apartments in the area is 95.6% and the lease renewal rate is 45.7% (both slightly below Orange County and San Diego).

Almost half of the nation’s hottest small rental markets are in the Northeast, led by Harrisburg, PA

Fueled by the spread of remote work and a large number of students in search of off-campus housing in college towns, the Northeast boasts seven renting hotspots in the top 20 most competitive small-sized rental markets.

Harrisburg, PA, is the most competitive small rental market in the U.S., with an RCI score of 123. Besides the cost of living and the convenience of renting here (just about everything you need is within 20 minutes by car), people calling Harrisburg home are also close to major metros like Philadelphia, Pittsburgh, Baltimore, New York City and Washington, D.C.

But, yet again, the lack of housing is making things difficult for both locals and newcomers looking for apartments for rent in Harrisburg. With zero apartments opened recently and extremely limited options to choose from, more than three-quarters (76.9%) of those renting in Harrisburg preferred not to move this rental season. This pushed the occupancy rate to a high 96.2%.

The second-most competitive small rental market is Fayetteville, AR (RCI score 122). This laid-back location in Northwest Arkansas is a magnet for both students enrolled at one of the nearby colleges and universities, as well as out-of-state workers seeking jobs as Walmart and other major employers continue to expand in the area.

Here again, even with a 0.96% uptick in new apartments, rentals are so scarce that almost 78% of renters chose to stay put. Consequently, with less than 3% of rental units available throughout Fayetteville, it only takes 18 days for the average vacant apartment to fill — the fastest among all 137 markets analyzed — and 14 renters compete for each vacant apartment in Fayetteville.

As if it weren’t already hard enough for renters to find available apartments in many regions across the country, there were virtually zero new units built recently in half of the top 20 hottest small-sized markets.

One notable exception is Lehigh Valley, PA, boasting an RCI score of 112. It experienced a 1.34% uptick in new apartments in recent months, which is one of the highest increases in the local supply of housing among all 137 markets analyzed. Yet, even with the newly opened units, this thriving area of Pennsylvania is unable to meet the high demand for apartments. Adding to the difficulty, a staggering 80.9% of people renting in Lehigh Valley chose not to move this rental season.

Similarly, the 1.02% increase in new apartments in Madison, WI, is not enough to accommodate the growing demand coming from new residents lured here by jobs in tech, biotech and healthcare. With less than 4% of apartments available for rent and 60.5% of renters renewing their leases, vacant apartments in Madison become occupied within 26 days — faster than anywhere else (with the exception of Fayetteville, of course). What's more, there are 19 prospective renters competing for the same vacant unit.

Other small markets that are highly competitive this rental season include Providence, RI; Knoxville, TN; Asheville, NC; Tulsa, OK; Little Rock, AR; Fayetteville, NC; El Paso, TX; Wichita, KS; White Plains, NY; Columbus, GA; Greenville, NC; Buffalo, NY; Fort Wayne, IN; and Rochester, NY.

Browse the maps below to see the rental competitivity in other regions:

Methodology

To compile this report, RentCafe.com’s research team analyzed Yardi Systems apartment data across 137 rental markets in the U.S. The data comes directly from market-rate large-scale multifamily properties of at least 50 units. Fully affordable multifamily properties were excluded.

The markets were ranked based on a market competitive score. To calculate each market’s score, we ranked them according to five metrics and their averages for January through March 2023: apartment occupancy rate; average total days vacant; prospective renters per vacant unit; renewal lease rate and share of new apartments completed during the same timeframe.

We then compiled an average ranking by assigning a percentage weight for each metric: 30% for apartment occupancy rate; 15% for average vacant days; 15% for prospective renters per vacant unit; 30% for renewal lease rate; and 10% for the share of new apartments.

In this study, the terms “market,”, “area”, “metro” and “location” are used interchangeably and are as defined by Yardi Matrix markets.

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