The most competitive rental markets in 2021 were small, outdoor-friendly metros, with limited apartment supply, according to RentCafe’s year-end report. Eugene, Oregon, topped the list, followed by San Diego and Knoxville, Tennessee.
RentCafe found that renters in these top three competitive markets struggled to find apartments due to high occupancy rates of 97% and approximately 30 applicants with solid credit scores competing for a unit that was snatched within two to three weeks on average.
To rank the hottest rental markets in 2021, RentCafe looked at the 105 largest markets in the U.S. where data was available for the most revealing metrics in terms of competitivity, including the number of days rentals were vacant, the percentage of apartments that were occupied, the number of renters competing for vacant apartments, and rental applicants’ average credit scores.
In the heart of the Pacific Northwest, Eugene’s metro area, which includes Bend, has been consistent in attracting new residents who want a more relaxed lifestyle, a continental climate, and close proximity to outdoor activities. It also boasts a rapidly growing tech scene, being dubbed the Silicon Shire.
The total number of apartments in the metro increased by 5 percentage points in the past two years, or 2,380 units, according to Yardi Matrix data. No fewer than 30 prospective renters competed for a unit, and it only took on average 24 days for a unit to be occupied during 2021. In addition, people who applied for apartments in Eugene had an average credit score of 670—30 points higher than the national average.
San Diego, which came in second on RentCafe’s list, remains a popular alternative for renters compared with pricier West Coast metros, especially now with hybrid work. However, not enough apartments have been built in the market in the last two years to meet the growing demand. In 2021, it took 26 days for an apartment to be leased, with 29 people competing for a rental. This year, people who applied for apartments in San Diego had the highest average credit score among the top 10 rental markets—671.
Rounding out the top three is Knoxville. This smaller and more affordable market had fierce competition since very few apartments have been built since 2020. According to RentCafe, renters’ interest in Tennessee has been increasing since the start of the pandemic because of the affordable cost of living, no income tax, and the scenic surroundings. The state was ranked No. 1 by U-Haul in its 2020 migration trends report for the first time. Knoxville saw 36 people competing for a unit during 2021—three times more than the national average—and had a sizable number of residents moving from pricier metros like Chicago, Los Angeles, New York, and the San Francisco Bay Area.
Other key findings from RentCafe’s year-end report include:
- On a national level, apartments only stood vacant for an average of 28 days this year. However, some markets saw quicker turnarounds. Apartments in Fayetteville, North Carolina, were leased in 15 days on average, and apartments were occupied in 18 days in Knoxville and Pensacola, Florida.
- The national occupancy rate was 95% this year and even higher in some markets. California’s Central Valley and Fayetteville saw occupancy rates at 97.9%.
- Nationwide, on average a renter competed with 13 others for the same vacant apartment. But it was more competitive in certain markets, like Knoxville, where 36 renters competed for one apartment and Pennsylvania’s Lehigh Valley, where 34 renters competed for a unit.
- Rental applicants had an average credit score of 640 this year. But several markets saw higher-than-average scores, like North New Jersey at 707, Pittsburgh at 685, and Seattle at 677.
