Compare Rental Property R/P Ratios

2018 was an interesting year for owners and PM’s. Major hurricanes, flooding, fires, and economic turmoil, kept property investors glued to market reports to help them decide on where to invest.

We thought we’d take a new look at the most recent data from Zillow and Zumper regarding price to rent ratios in major metros to discover buying opportunities for you to drill down on. If you’re an investor/property manager, please offer your thoughts in comments.

The chart below is a snapshot in time, and we should remember that employment and rent price trends are also active and changing.  Rents are trending upward in many markets in the last few months.

Rental Price Stats from Zumper

According to a report from Zumper, San Francisco is holding onto its crown of highest rental prices in the US. That’s ahead of other superheated rental markets in New York, Los Angeles, San Jose, and San Diego.

It seems the cities with highest rents are in California, however when you consider prices, cap rates, taxes, and rent profits, other states and cities may offer better ROI including better rental yields.

If there was a supposed downturn in California due to the loss of free trade, it’s not showing up in apartment rents here

Zumper’s national rent report reveals New York, San Jose and Los Angeles are well behind San Francisco in rent prices. Surprisingly, San Diego is ranked number 10 at $1810 per month. Their September 2018 data indicates the highest rents for a 1 bedroom apartment are a pricey $3,395 per month in South Beach, $3740 in Pacific Heights, and and $3650 in Telegraph Hill and Hayes Valley.

Zumper says 2 bedroom rents across the nation fell .3% last month yet are still up 3% YoY.

So we know which cities have the highest potential rental rates and they’re rising again. These stats below don’t necessarily reflect the complete picture for high volume, corporate investment returns in the multifamily market, but rather small to medium investors buying existing rental properties.

Price to Rent Ratios for Most Major Metros

The price to ratio is a key stat for property investors who are looking for the best properties in the best cities. See our posts on the Phoenix market, San Jose housing market, San Francisco housing, and Las Vegas housing market of recent. Here’s the most recent rent price ratios below.

The big surprise is San Jose, CA. Probably one more reason why the San Jose housing market is so hot.

Are you surprised at San Jose as the rent/price leader? If you read the post on San Jose’s housing market, you’ll see the intense interest in property there. The expectations are high for 2019.  San Jose and San Francisco are epicenters for tech startups including Proptech startups.

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