Big cities have always seen the highest rents. Big demand and limited supply see to that. Now smaller cities are falling in line, seeing rents rise faster than those in even some of the hottest markets. The reason is rising demand. As employment improves, new households are finally being formed again, and they are all renter households. The home ownership rate is still falling.
The national apartment market saw its strongest January of the post-recession period, with rents rising 4.9 percent annually and occupancy at 94.6 percent, according to Axiometrics, an apartment research firm.
While California markets still lead the nation in high rents, smaller cities are jumping. January's fastest-growing rental markets included Denver; Kansas City; Nashville; Portland, Oregon; and Charlotte, North Carolina, according to Zillow.