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Housing is costlier for many Virginians as rents continue to rise at the fastest pace in decades.
Richmond-based CoStar Group, which provides information, analytics, and marketing services to the multifamily and commercial real estate industry, reports that nationally, rents increased 11.3% last year, and this fast pace of growth has only increased in 2022. In fact, CoStar is forecasting another 6 percent rise in U.S. rents this year, about double pre-pandemic norms.
Here are the main factors contributing to the increase:
A supply-demand mismatch
Younger Americans looking for apartments and consequently squeezing an already tight housing market
Pandemic-related material shortages and construction delays slowing down the production of new homes and rentals
Mortgage rates, already reaching highs not seen since 2011 thanks to rising interest rates, driving would-be homeowners to rent instead
A migration from pricey city centers — such as New York and D.C. — to more affordable places. Many white-collar workers in high-paying industries such as tech and finance are transitioning to more flexible remote-work arrangements. Winchester, for example, is the fastest-growing community in Virginia as many from D.C. are moving there to work from home.
While some Virginia communities have seen 20-22% rental rate increases, more remote locations have seen drops or marginally small increases.
The burden of rising rents falls heaviest on younger households and Black and Hispanic families. Sixty-two percent of families with heads-of-household under age 35 renFauquiert, compared with 30% of households with a head between agest 45 and 54. At the same time, a majority of Black and Hispanic families rent their homes or apartments, while just over a quarter of their White peers do the same.
Low-wage workers are also being disproportionately impacted. There is not a single state, metro area, or county in the United States where a typical minimum-wage worker can afford a two-bedroom rental.*
What Virginia Cities and Counties Saw in 2021
This chart shows how much rents increased in 2021. If your location isn't shown, it is because data was unavailable.
Isle of Wight
Prince George County
Prince William County
Yes, Wise County is the only spot in Virginia that saw a decrease in rents in 2021. Perhaps, if you are thinking about finding the idyllic setting for your get-away-from-it-all, work-from-home set-up, Wise County is an excellent place to start looking.
*National Low Income Housing Coalition.
Sources: Washington Post, CoStar Group, Virginia Realtors