Miami remains the hottest rental market in the country, but competitiveness for apartments is heating up in the Midwest, according to RentCafe.
Through analysis of Yardi Matrix data, RentCafe maintains a Rental Competitivity Index (RCI), which determines the competitiveness of the rental market through five metrics: the number of days that apartments are vacant; the percentage of apartments occupied by renters; the number of prospective renters competing for an apartment; the percentage of renters who renew their leases; and the share of new apartments recently completed.
At the start of 2024 (based on data averaged from October through December 2023), the national RCI score was 73.4, which signifies a moderately competitive real estate market, per RentCafe. That’s significantly hotter than it was for most of 2023; the national RCI reading from January to September was 59.5.
Miami’s rental scene is blistering compared to the national market, with Florida’s largest metro logging an RCI reading of 91.9. Already a sizzling market last year (Miami’s RCI from January to September was 81.9), Miami’s warm climate, laid-back lifestyle and healthy economy secure a hardy foundation for robust apartment demand. It takes just 36 days for a vacant Miami apartment to find a new tenant, and with 14 renters competing for each unit — most in the country — there is no shortage of competition. Just 3.5% of Miami’s total rental stock is available for apartment seekers, and with newly built apartments only accounting for 0.97% of the city’s units at the start of 2024 (down 1.2% year over year), new deliveries aren’t giving apartment seekers too much help.
Perhaps surprisingly, the second hottest city in terms of rental competitiveness is Milwaukee, with an RCI score of 87.0. Brew City may not boast the nightlife and warmth of South Beach, but Milwaukee’s strong job market and affordable cost of living are attractive to renters. Milwaukee also has short supply of apartments and its share of newly built rentals accounts for just 0.53% of all for-rent units in the metro area. Vacant apartments stayed vacant for just 37 days, with nine competitors for each available unit.
Milwaukee is among five Midwestern markets among the top 10 for rental competitiveness at the beginning of the year, according to the RCI. Joining Milwaukee near the top of the list are suburban Chicago; Grand Rapids, Michigan; Cincinnati; and Lansing, Michigan, all of which have an RCI reading above 80. The Midwest’s relative cost-effectiveness, coupled with a low inventory of available rental space in many areas, are pushing its cities up the RCI rankings.
