The U.S. rental market is well-established as a dynamic entity, with the marketplace continuously influenced by factors like economic conditions, housing policies, and evolving tenant preferences. It is also a market dominated by youth; with over 50 percent of renters being under the age of 30.
As 2025 unfolds, securing an apartment is becoming even more challenging in the context of the U.S. property market. This scarcity of property is despite new apartment construction hitting record highs last year. A report titled Rental Market Competitiveness Report reveals that while new supply has increased across the U.S., surging lease renewal rates are keeping the rental market very competitive for apartment-hunters.
At the U.S. national level, the Rental Competitiveness Index (RCI) score has risen to 75.7, showing a more competitive market than one year ago.
The data suggests that more renters are choosing to stay put: The lease renewal rate hit 63.1 percent, up from 61.5 percent in early 2024, reducing turnover and limiting options for new renters. At the same time, apartment occupancy is holding steady: With 93.3 percent of units occupied, demand continues to outpace supply, slightly exceeding the 93 percent occupancy rate at the start of 2024. However, it is taking longer to fill vacant apartments: Units now stay on the market for an average of 43 days, two days longer than a year ago.
Manhattan sees the second-biggest surge in rental competitiveness, with its RCI score rising 8.2 points to 77.3. Although it did not make it to the top 20 (ranking #26), demand remains very high: 66% of renters renewed, leaving fewer than 5 percent of apartments available. Apartments in Manhattan now fill three days faster than a year ago, while competition has increased to seven applicants per vacant unit compared to five one year ago.
Also of interest, Washington, D.C. grew more competitive, with its RCI score rising to 77.0 from 71.8. Despite no change in vacancy periods (42 days) or the number of renters per unit (7), competition remains tight due to a higher lease renewal rate (59%, up from 57.8%) and a sharp drop in the share of new apartments (0.39%, down from 0.71%), thus limiting options for prospective renters.
Renters are facing intense competition
Rental compeition remains intense, according to the report. Each available apartment attracts an average of seven applicants. This suggests that new apartment supply remains insufficient. Indeed, the share of new apartments entering the market rose slightly to 0.75 percent from 0.67 percent in early 2024, but that is insufficient to meet demand.
In terms of state-by-state variances, despite Florida’s cooling trend, Miami holds onto the top spot with a 96.3 percent occupancy rate and 14 renters competing for each vacant unit. Following this, Chicagoland has become hotter with Suburban Chicago surging to second place nationwide driven by lease renewals at 70.4 percent and a 95.4 percent occupancy rate, while the city of Chicago jumped to #18.
Overall, the Midwest leads in rental competitiveness. This region is claiming 10 of the top 20 rental markets, the region’s affordability and job opportunities make it a very tough place to secure an apartment. Within the fast growing areas, the ‘hottest’ small market is Fayetteville, AR. With only 3 percent of units available, vacant apartments fill in an average 22 days.
