As rent prices continue to climb across the U.S., many people are finding it increasingly difficult to purchase homes due to high prices and interest rates.
This surge in demand for rental apartments is pushing rents higher. Interestingly, while the average size of newly built apartments has increased in some cities over the past year, this trend is not universal.
A study by RentCafe, using data from its sister company Yardi Matrix, found that the average size of new rentals grew by 27 square feet between 2023 and 2024. However, in some cities, apartments have either shrunk over the past decade or remained small, despite rising rents.
Here are six metro areas where apartment sizes are shrinking, but rent prices keep going up.
1. San Francisco, California
San Francisco has long been known for its high rent prices, but the average size of new apartments has been decreasing. With the city’s booming tech industry, the demand for housing is incredibly high. Many new developments are prioritizing location over space, resulting in smaller apartments with higher rents.
2. New York, New York
In the heart of New York City, the trend of smaller apartments continues. Manhattan, in particular, has seen a significant increase in rent prices while apartment sizes have shrunk. The limited space and high demand mean that developers are building smaller units to maximize profit, making it hard for renters to find spacious, affordable housing.
3. Los Angeles, California
Los Angeles is another city where apartment sizes have remained small, despite rising rents. The sprawling nature of the city and its desirable climate make it a hot spot for new developments. However, the emphasis on luxury amenities over square footage means that new apartments often feel cramped.
4. Seattle, Washington
Seattle’s growing tech industry has drawn many new residents, increasing the demand for housing. The average size of new apartments has decreased, even as rent prices continue to rise. Many new buildings offer smaller units with shared amenities to attract young professionals looking for a place in the city’s vibrant neighborhoods.
5. Washington, D.C.
The nation’s capital has also seen a trend toward smaller apartments. With high demand from government workers, students, and professionals, new developments often prioritize proximity to work and transit over space. As a result, rents are high, but living spaces are small.
6. Boston, Massachusetts
Boston’s rental market has been hot for years, and the average size of new apartments has not kept pace with rising rents. The city’s rich history, numerous universities, and booming tech sector attract many people, leading developers to build smaller units to accommodate more residents.
Conclusion
In these six cities, the trend of shrinking apartment sizes paired with rising rents is making it increasingly difficult for residents to find affordable and spacious living arrangements.
While some areas have seen an increase in the average size of new apartments, this is not the case in these metropolitan areas. If you are looking for more space for your money, it might be wise to consider other locations where apartments are larger and more affordable.
Explore and Learn More
For those looking for safer and more affordable cities to live in, you can explore the “50 Safest and Most Affordable US Cities To Live In.” Additionally, if you’re interested in real estate investment, you might want to learn how to “Become a Real Estate Investor for Just $1K Using This Bezos-Backed Startup.” These resources can provide valuable insights and help you make informed decisions about your next move.