The relentless search in major cities for affordable yet aesthetically pleasing housing isn't getting any easier.
Real estate firm Douglas Elliman released a report this week showing New York's white hot rental market—one of the most torrid in the country along with San Francisco—experienced a marginal cooling in May. During the month, median rent prices in the city dipped 0.4 percent to $3,358 from a year ago, helped by concessions offered by landlords to prospective tenants.
The firm added that price trends are expected to "move sideways over the coming months following a two year trend of rising rents that ended in March."
However, last month's modest decline masks what many observers are calling a housing crisis in urban areas. Rents in the Big Apple and the Bay City are still well above the national average of $1,248 in the first quarter of 2016, according to figures from research firm Axiometrics.
In fact, rents in Brooklyn—one of the city's hottest neighborhoods—saw a fifth consecutive month of price hikes across all apartment sizes, Douglas Elliman's report noted. Despite a construction boom peppering New York's skyline with new apartment buildings, very little of that new housing stock is alleviating the seemingly inexorable rise of both prices and demand.
Despite a "leveling off" in some market segments, "excess new supply skewed to the high [end] and tepid wage growth is pushing renters to outer reaches of the city as well as the surrounding suburbs," Jonathan Miller, president and CEO of Miller Samuel real estate appraisers, who authored Douglas Elliman's rental report, explained in an email to CNBC.
The dynamic is being exacerbated by a trend of residents attempting to escape the pricey rents in city centers by migrating to cheaper, often working class areas—which themselves soon experience a spike in housing costs.
Otherwise known as gentrification, the term has become a pejorative among residents that associate gentrifying areas with frothy rents that often force poor and working class renters to flee.
"Many renters are buying homes further out in the suburbs after reaching their affordability threshold in the city," Miller said. "They aren't necessarily renting in the suburbs and it is why we are seeing a lot of suburban sales growth."
Howver, "renters that move further from the city's core in search of affordability but stay within the city are driving up prices, i.e. gentrification," Miller added.