Rental costs in the Middle Tennessee region have increased by 28.4% since last January, according to a recent study.
Dwellsy, a digital service that helps tenants find rental units, analyzed data from 400 markets across the country and found the median rent in Greater Nashville had reached $1,780, an increase of $394 over the last year.
The Nashville region is on the high side of the national trend — data showed rent increased throughout the country by 16.3% since January 2020.
Dwellsy CEO Jonas Bordo said he doesn’t anticipate the conditions pushing prices up to change any time soon. Certain factors of the pandemic, particularly people’s ability to work from home, have driven them to seek homes with more space, to allow some separation between their work and leisure time.
“In the long run, we expect that markets like Nashville that are pretty good at adding new housing will do so, addressing the [market] issues,” Bordo said. “Unfortunately, it takes time for new housing to get built, and given supply chain and staffing challenges for builders, building is taking longer — and costing more — than usual, so we don’t expect enough supply to come online in the short term to help in 2022. As a result, we expect continued rent increases this year.”
Ranked immediately below Nashville is Knoxville, which saw rents grow from $1,013 last January to $1,775, an indication that the state’s explosive growth isn’t limited to Middle Tennessee.
A breakdown of the data showed apartment rents have only increased 12% over the last year whereas the cost to rent a single-family home has gone up 24%.
Two major contributors to the increase are limited supply of rental units and the number of high-income households entering the rental market.