Very high rents mean some people are ditching high-rise buildings for greener pastures, study finds bank of america. Living costs have proven unaffordable in many cities, forcing many Americans to either move or downgrade to cheaper apartments.
Bank of America looked at deposit data from a sample size of about 45 million customers and found that Americans’ median rent payments rose 3.7% over the past year. This is one percentage point lower than the reported rent inflation rate. So what does it mean? Essentially, the report says the gap is due to people “downgrading within the same city,” so Americans are scrambling to find a deal.
“Consumers would rather pack up than pay higher rent, and this is due to two developments,” said Joe Wadford, an economist at the Bank of America Institute and a contributor to the report. It’s conceivable,” he explained. CNBC’s “Make It”. “The first is to move to cheaper cities. Second, an increasing proportion of people are saving money and playing it safe by downgrading within the same city,” he added. .
During the pandemic, many city dwellers left their coastal homes, made even more possible by the option of working from home. According to some sources, many of those who moved (or were considering moving) were Gen Z and Millennials. luck According to a Bank of America report, renters “skew skewed toward young, low-income consumers.”
Several years later, this trend continues to some extent. However, this time it’s a matter of price. People from the West and Northeast are moving to the South and Midwest for more affordable options, the report said. After all, there are better deals out there. Those moving to the South will experience new rent increases of just 2%, which is “significantly lower than the rate of inflation.”
And those who can afford to stay in the cities and relocate. The trend toward cheaper apartments is most common among people with incomes of $125,000 or more. This is an even more pronounced phenomenon in the Northeast, where high-income earners staying in the same city paid 6% less in new rent in the third quarter of this year. That means wealthy city dwellers are doing everything they can to shrink down and stay put.
Still, it’s not always enough.
The top eight cities people moved to last year were:
- san jose
- miami
- san francisco
- boston
- Los Angeles
- new york
- orlando
- washington
On the other hand, the cities where the most people moved are the following eight cities.
- indianapolis
- columbus
- denver
- cleveland
- austin
- las vegas
- san antonio
- phoenix
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