Renters stay put as competition climbs in Midwest, Northeast, and California
The US rental market is facing intensified competition this summer as lease renewals surge and new apartment supply fails to keep pace with demand, according to RentCafe’s latest Rental Competitiveness Index (RCI).
The national RCI rose to 74.6 at the start of the 2025 rental season, up from 73.4 a year earlier, signaling a tighter market with more renters staying put and limited new construction.
Rental occupancy remains high at 93.3%, with an average of nine prospective renters competing for each available unit, an increase from eight renters in 2024. Lease renewals are also on the rise, climbing to 63.8%, up from 62.4% the previous year.
Despite 2024 being a peak year for apartment construction, the pace of new supply has yet to catch up with growing demand. Available inventory has only increased by 0.72%, a marginal improvement from 0.61% last year.
“The 2025 rental season is off to a tight start, despite new apartment construction hitting its peak in 2024,” the report noted. “Only 8% of the major markets analyzed have shown any signs of easing.”
Florida, Midwest lead rental competition
Florida has emerged as the nation’s most competitive rental region with an RCI of 80.9 — 6.3 points above the national average and up from 78.9 a year ago. The renewed demand is driven by a combination of lifestyle migration, including retirees seeking warmer climates, and younger renters attracted to job growth, affordability, and the absence of a state income tax.
The Northeast ranked second with an RCI of 79.4, followed by the Midwest at 77, reflecting a three-point increase. The South (76.1), California (74.7), and the Mid-Atlantic (74.6) also reported year-over-year gains in competitiveness.
Among notable local markets, Miami continues to rank among the most challenging cities for renters, while Chicagoland is gaining traction due to its affordability and strong job base. In Texas, Houston renters are also seeing tougher competition as fewer new units have opened recently.
Meanwhile, North Jersey has seen a decline in rental market pressure, with its RCI dropping year-over-year. Meanwhile, Manhattan has grown more competitive compared to last year.
Read next: Is US housing affordability about to take another hit?
RentCafe’s expanded analysis now includes data on lease duration and renewal behavior. Nationally, renters stay an average of 29 months. New lease terms typically span 12 months, with renewals often extending another 12 months.
In the Northeast, renters stay longer, averaging 39 months, with Brooklyn leading at 53 months. Lease and renewal terms in Brooklyn are also the longest, at 14 and 15 months respectively.
“Renters who sign longer leases are more likely to renew for longer periods,” the report noted. “Markets where renters stay longer see higher renewal rates, further tightening competition.”
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