According to a recent Zillow survey of major metropolitan areas in the USA, single-family rentals in Phoenix are 46% more expensive than apartments. This trend is driven by high mortgage rates and a lack of response from builders, which has kept multifamily rent growth stable for many months. As a result, rents for detached single-family homes continue to rise at an accelerated pace.
Phoenix-metro area leads the nation in the build-to-rent (BTR) sector, with strong demand from millennials looking for larger living spaces. Zillow’s Skylar Olsen explains that due to high and unpredictable mortgage rates and hefty down payments, many millennials are choosing to rent instead of buying their desired lifestyle.
Since before the pandemic began, single-family rents have increased by 41%, compared to only 26% for multifamily units. In Salt Lake City –the largest difference among the top 50 U.S metros–single-family rentals hold a significant price premium of 59% over multifamily units.