Can someone explain why rent is so ridiculously expensive in the US?

[Snowie1969]

I wondered about this a long time now ever since i heard models talking about just how big their rent is for the little space they have and having to share this with a roommate but.. my main question is: WHY?

I come from the Netherlands, a country so infinitissimally small in area compared to the USA but the prizes for rent here at least are acceptable, sometimes being 1/3rd of what a similar appartment/ house would cost in rent in the USA

At the same time, real estate prices are low (in the countryside at least, not the big cities like LA or New York) compared to here, but of course, those require you to either save up to buy it or to apply for a mortgage (for which you would need regular income)

Your thoughts on this please?

 

[BiancaBaker]

I live in a big city and it's expensive as fuck - a 2 bed here goes for around 2k-3k : prob closer to 3k (in the city), Other parts of America are not as expensive though. Arizona, Texas, Florida, Nevada and most mid west states are very very affordable. I plan on purchasing a house next year so it is do-able but I've been saving for 2 years and yes you would need to make a good salary to afford a big city.

Also NYC is my dream and I would love to live there (prices are comparable here so I could afford it but nope I'm stuck here)

 

[JickyJuly]

America is huge. The variation in home costs is also huge. Like Bianca said, it totally depends on the place. I rent a 2 bed/2bath house with a yard and lawn service in a safe area in Florida for $600.

 

[zippypinhead]

Yeah, if you aren't living in a metro area, especially on a coast, rents aren't so high.

Rent is high where it's high because that's where the money is.

 

[Guy]

I heard that rent in Los Angeles is insanely high.

 

[JerryBoBerry]

For the most part I think it's comparable, but you may be comparing apples to oranges so to speak.

Many of the models who live in the really expensive apartments are living in one of the larger cities in America. And they may also be living in a more upscale apartment. Neither of those things really compare with average apartment prices around the country.

Also prices vary for other reasons too. Population compared to available apartments, how geographically isolated it is from nearby cities, real estate prices in general, climate factors...

A small home going for $600,000 in New York can go for $100,000 in New Jersey, just 40 to 50 miles apart. Prices in Colorado can be more expensive because of the draw of skiing and everyone wanting to live there. An apartment where I live can go for under $400 a month because it's economically depressed. Washington DC is very expensive due to the government buildings and workers being there. Washington state can be higher than average due to Californians moving there driving prices up (because it's even more expensive in California, so to them it's still a bargain).

So overall prices are going to vary a lot from one city to the next.

But let's just look at population comparisons.

Amsterdam has a population of 780,000 people (from google 2011). According to this site, the average 1 bedroom apartment is 1,322.47 € per month ($1484.94 USD) with a range of 1000 € to 1600 €. ($1122.85 to $1796.56 USD)

So let's look at a few similarly sized US cities and compare overall averages to Amsterdam. These are just the first google results and should just be taken as a quick average, not scientific results. It shows, as expected, the price of a 1 bedroom apartment varies greatly around the country. But we can look at the average for all of them, as in the chart below.

Population data taken from here. (New York Burroughs looked up individually) Average apartment prices taken from various sites for each city.


Using that data to construct a chart shows Amsterdam is more expensive to to rent an apartment than the US in a similarly sized city. These are 'average' city prices, individual comparisons can vary greatly as the chart shows.






And keep in mind while these are only large cities compared to Amsterdam I think the comparison would still be around the same for "out in the country" away from urban centers. Like I said, I live in a small town and I can get a one bedroom apartment for less than $400 easily.

 

[Snowie1969]

One thing that kind of pushes prices up in Amsterdam is that it is a more international orientated city. Some US cities of comparable size may have a head office or 2.. Amsterdam has a lot of them.. seriously.. Those affect job possibilities, general income etc.. and with more people having more to spare, rents can stay up there. In the Netherlands, the closer you get to Amsterdam, the higher your rent is going to be. Ask people in Haarlem (20 km away) or Leiden (37 km away) about that...

And maybe i just happen to have met models who have the bad luck in living in appartments that are too expensive. My sample of people I happen to know some of the living condition of is rather small after all (dozens at best)..

 

[SaffronBurke]

I live in Iowa, and what other people think is "cheap" rent, I think is "holy butt fuck" expensive. I've rented a 3-br house with a semi-finished basement, two-car garage, and huge yard for $950/month. My current 3-br apartment is $890. And that's in a city, and on the expensive end for this state.

As for purchasing a home? You can find a decent sized house in Des Moines for $50,000, if you want to live in a "bad" neighborhood (those aren't actually BAD neighborhoods, though, everyone's just poor and it's mostly minorities so people make that assumption), or you can get the same size house out in the suburbs for $250,000. The only difference is one house is on the South Side, and the other's in Clive. Hell, there was even a house for sale a few years ago in a historical district for $8,000, plus you'd get a grant from the neighborhood association to restore it so it could be a landmark again.

 

[Carmita Bonita]

In Hawaii, it's very comparable to Los Angeles. It's raised drastically the last few years and a LOT of people here either work 2 jobs or have roomates/never move out of the family house. If you see anything cheaper by Hawaii standards (800-1600) it's either a shared house or a crap neighborhood.

Buying a house here is worse... I wouldn't advise anyone to do it unless they were very rich/desperately wanted to live here.

 

[SexySteph]

Supply and demand. More and more people can't afford to buy houses (particularly young people) so they have no choice but to rent. Companies and private renters can increase the price like crazy because the choices are rent or be homeless.

 

[Sevrin]

AirBnB is also increasingly responsible for high rents in popular locations. Here in Montreal, absentee renters with leaseholds on multiple downtown apartments for the sole purpose of renting them out through AirBnB are becoming a serious problem for people just looking for a place to live.

 

[Magnolia]

I live in Las Vegas, which is a heavily-populated, cultural-rich, business center city... but housing here is dirt cheap. A lot of this probably has to do with most of the area being unicorporated (long history behind that fact)? Well, and I guess people's distaste for the Mojave weather.

What I'm saying is you CAN get the best of both worlds: bustling city with lots of job opportunities and cheap housing.

We also don't pay state tax, our produce is insanely cheap (thanks California), gas is average to low priced, and if you're a local there are so many free things to do that you can never be bored even on the lowest budget.

God damn it, I love Vegas.

 

[SaffronBurke]

I live in Las Vegas, which is a heavily-populated, cultural-rich, business center city... but housing here is dirt cheap.

I kept hearing this, so I looked at available apartments in Vegas, and went "eek" at the prices. A typical 2-br apartment here is $600-700, and I couldn't find much for that little in Vegas. Maybe I was looking at the wrong sites, I don't know.



I am so spoiled and I know it.

 

[Magnolia]

I kept hearing this, so I looked at available apartments in Vegas, and went "eek" at the prices. A typical 2-br apartment here is $600-700, and I couldn't find much for that little in Vegas. Maybe I was looking at the wrong sites, I don't know.



I am so spoiled and I know it.

Really? My 2nd apartment here was only $650 a month. 2bed/1bath with utilities included. Was in an alright area too.

The house I live in now would be $3k-$4k a month in the last place I was living, I get it for less than half that here so idk.

 

[SaffronBurke]

A

Really? My 2nd apartment here was only $650 a month. 2bed/1bath with utilities included. Was in an alright area too.

The house I live in now would be $3k-$4k a month in the last place I was living, I get it for less than half that here so idk.

I must have been checking the wrong places, I couldn't find anything for under $800.

 

[Worship Jaclyn]

Everyone has different priorities too. So you definitely can't judge prices based on what one, or many cam models say. Some people will live in a small or less than adorable place to save themselves money, some people will stretch themselves so thin they can't afford to do or buy anything so that they can live in a really nice place. To each their own but when someone who doesn't live in a big city complains too much about not being able to find a place, I would just take it with a grain of salt. Maybe it's true absolutely, but maybe the person also has an incredibly long list of what her apartment or home must have.

 

[MiloKnee]

The apartment I'm in right now (1bdr, 1bath, 780ish square feet hovel) is 375/month. But next Friday I'm moving into a bit nicer apartment (900sq ft 1bdr, 1 bath with sunroom and kitchen that I can actually freaking move around in) for 450/month. In my state, only the capitol is a major metropolitan area so rent is pretty okay if you're willing to slum it a bit. Of course, neither of these apartments have a washer and dryer or dishwasher. But you could find an apartment that did for the same price I'll be paying very easily in my city.

 

[Lintilla]

The chart in @JerryBoBerry's post explains one of the reasons I moved to Tucson

I pay about $750 for two bedrooms. Could have gone quite a bit lower (maybe even $200 less), but I wanted W/D, dishwasher, etc. etc. And I was very picky about my location. It's not a luxury apartment by any means, but it is AMAZING compared to what you can get elsewhere for the same rent.

I paid around $100 less when I lived in Indiana for an equivalent place (larger with high ceilings, but some other tradeoffs), but the downside was... it was in Indiana.

Both places have pretty cruddy job markets. Luckily for me, that's not a concern.

Now, Chicago... I lived in a roach-infested two-bedroom with a bathroom ceiling that was caving in and not even one full square foot of kitchen counter space, outside stairs that were falling off the building, every window painted shut. That was $950, and that's SUPER LOW, especially a stone's throw from Wrigley Field. I believe that place got bought and torn the fuck down. Probably should have been condemned. Maybe it was for all I know. And then I lived in a three-bedroom garden apartment where everything was constantly broken, super low ceilings, cheapest possible version of everything, more roach problems (finally get fed up and solved that myself with a caulk gun and expanding foam), wiring problems, no A/C, no nothing... $1350. Also WAY cheap. Fuck that noise! Though, Chicago is an amazing city to live in, apart from the winters, so there's that.

 

[SoTxBob]

I live in Iowa, and what other people think is "cheap" rent, I think is "holy butt fuck" expensive. I've rented a 3-br house with a semi-finished basement, two-car garage, and huge yard for $950/month. My current 3-br apartment is $890. And that's in a city, and on the expensive end for this state.

that is dirt cheap... Even around houston area where I came from that is historically full of good jobs and cheaper rents, less than $1100 for a 3 br anything is cheap. Rental houses there, in average decent areas, will run you $1600+ for a basic 3-2-2. And you buy all of your own utilities and lawn maint. A typical 1br apt can be had for under $1000 easily.

 

[HiGirlsRHot]

A


I must have been checking the wrong places, I couldn't find anything for under $800.

Not necessarily.
I've owned a number of rentals in Vegas since 2009, and I have friends that also own a number. The places I rented at $600-650 were small, old, and not in great neighborhoods
The apartment at $750-800 near the strip was fine but not great..

The houses at $1000-$1,1000 were pretty nice places I'd have no problems living in.

This same friend has several houses in the suburbs in Detroit that I think he rents for like $600-700 that look really nice.

 

[LilyBlueBBW]

I always blame rent increases on inflation and the government pretty much showing that they dont give a flying fuck about the american people but yet i digress.

Here in detroit, we are in the midlevel stages of gentrification. You got a lot of folks investing in downtown but no money really gets invested uptown and that's pretty much where everyone lives. Downtown is mostly filled with lofts and i think the best ones go for about $1600 to $3800 a month.

You can rent a nice house uptown for about $500 to $700 a month but no utilities are included and you have to pay your water bill.

If you are spending $375 a month in these parts, you are usually renting out a room that is in a house that is owned by an old lady or a pervert.

The lowest you can spend for an apartment in these parts is about $400 and that's usually for the shittiest places ever. You will get all the utilities that come along with the apartment but you might also get a couple of rats, crackheads, and roaches that are in the building.

There are like 2 really nice parts of town here and that's the boston edison district and West Outer Drive. The boston edison district is like 5 minutes away from the bad part of town and that neighborhood is frequented by a lot of doctors and lawyers and things of that sort but the homes are beautiful and you can buy one for about $90,000 to about $260,000. West Outer Drive is the same way but those houses go for about $325,000 a pop.

There used to be a thing here where you could buy a house for about $500 to $1000 but those were usually fixer uppers or really burnt houses that needed serious repair and renovating.

The property value in detroit is all over the place because of the crime rate.

 

[Jesse0328]

Fallout from the 2008 mortgage crisis has pushed more people into renting. Increased demand raises prices. Depending on the area, buying a house can be cheaper than renting, if you can survive the underwriting process.

 

[yummybrownfox]

Yup, I've been on several 2-bedroom apartment tours just in this past week and a half, and I'll tell you something...sometimes I really do miss being a kid, and not having to worry about bills. LMAO.

 

[Snowie1969]

Yup, I've been on several 2-bedroom apartment tours just in this past week and a half, and I'll tell you something...sometimes I really do miss being a kid, and not having to worry about bills. LMAO.

Don't we all.

I always blame rent increases on inflation and the government pretty much showing that they dont give a flying fuck about the american people but yet i digress.

Here in detroit, we are in the midlevel stages of gentrification. You got a lot of folks investing in downtown but no money really gets invested uptown and that's pretty much where everyone lives. Downtown is mostly filled with lofts and i think the best ones go for about $1600 to $3800 a month.

You can rent a nice house uptown for about $500 to $700 a month but no utilities are included and you have to pay your water bill.

Interesting: Here in Holland, utilities are never included in the rent price, which means you can expect to pay another 100 euro/ month for electricity and gas and 60 euro for water.

Also, from the complete discussion, I get the idea that more, if not most appartments in the US come with the furniture..

 

[SaffronBurke]

Interesting: Here in Holland, utilities are never included in the rent price, which means you can expect to pay another 100 euro/ month for electricity and gas and 60 euro for water.

I think covered utilities vary from state to state. In Iowa, it's typical to have water paid by the apartment complex, but the renter has to pay their own power and internet/cable. There's a couple places I've lived that pay heat - not full power, just heat in the winter.

Also, from the complete discussion, I get the idea that more, if not most appartments in the US come with the furniture..

Again, I think this varies by state. Here, the only furnished apartments are..... "gross" would be nice. They're tiny, low-income, studio units, some are 1-bedroom, and they're just terribly managed and taken care of. There's also an insanely long wait list to move into them.

 

[SoTxBob]

Also, from the complete discussion, I get the idea that more, if not most apartments in the US come with the furniture..

If you are in close proximity to a univ or have a larger temporary population like that, like a military base, you will find more furnished apartments. The vast majority come unfurnished. 98% of the time stoves and refrigerators are provided.

 

[CharlotteLace]

I think there's also a lot of amenities that can jack up your rent, as well. Have pets? What if they're on the "restricted breed" list? You bet your ass you're going to pay more than the average around you. A lot of insurance companies have strict stipulations about what's allowed on rental properties to be insurable, and that can dramatically affect your rent price, as well. I have a German Shepherd, and the last place I rented charged roughly $200/month more than the other properties in the area, simply for the luxury of allowing my "high-risk" dog to be there.

 

[yummybrownfox]

I think there's also a lot of amenities that can jack up your rent, as well. Have pets? What if they're on the "restricted breed" list? You bet your ass you're going to pay more than the average around you. A lot of insurance companies have strict stipulations about what's allowed on rental properties to be insurable, and that can dramatically affect your rent price, as well. I have a German Shepherd, and the last place I rented charged roughly $200/month more than the other properties in the area, simply for the luxury of allowing my "high-risk" dog to be there.

And whether or not you want a washer and dryer in your unit will determine the price. Also, whether it's a 2 bedroom, 1 bath...or a 2 bedroom, 2 bath. I always just assumed the 2 BR, 2 BA units would cost more, but that's actually not always the case. I think sometimes the units with just ONE bathroom cost more because (instead of that second bathroom) you get more living room space + an additional closet.

 

[AudriTwo]

because 'merica!

 

[JickyJuly]

I don't think I've ever lived in an apartment or house that included any amenities except water/trash or lawn. I would be rich if I didn't have to pay for electricity in this house. Not really, but my electric bill is brutal. And it took us SOOO long to find a rental that would take our dog. I originally wanted to live in Ocala, but they all wanted tons to let her live there or just flat denied. We ended up about 45 minutes from Ocala instead.