Each month, EDCUtah’s Research Minute highlights interesting economic development data and timely research insights. This month, we review rent affordability in the U.S. and how Utah compares.

Housing affordability in Utah has been a hot topic for both residents and businesses across the state. According to three different sources — Zillow, Redfin, and CoStar — residential renting became more affordable for Utahns in 2024, while becoming generally less affordable in the United States. While the cost of purchasing a home in Utah continues to rise, there is room for optimism now that rent prices have stabilized and even decreased, making the market more affordable for Utah’s renters.

Zillow and Redfin, two online real estate market and brokerage services, frequently publish reports on trends that their internal data shows in the housing market. Similarly, CoStar tracks real estate data and EDCUtah uses that data to see how these trends impact our state. Each publishes data on rent prices but they reported different changes in rent based on their data on both the national and local scale. Redfin and Zillow only use major metro areas in their analysis, so they were only able to report on the Salt Lake metro. CoStar has data on Utah’s other metro areas that show similar trends to the Salt Lake metro. This report will focus on the Salt Lake metro because of the two reports recently released by Redfin and Zillow.  

Zillow, Costar, and Redfin reported rent increases of 3.5%, 1.1%, and 0.1% respectively across the nation in 2024. This variance in values is expected since each source is pulling from a different sample of real estate throughout the country. Although there is disagreement in the exact rate of rent growth across the country, there is agreement that prices are still rising and may be stabilizing from the extreme growth in prices that peaked in 2022.  

Meanwhile, Zillow was the only source that saw an increase in the price of rent in the Salt Lake City metro, with only a 0.3% increase in prices, while Redfin and CoStar reported that the metro decreased rent prices by 6.5% and 1.1% respectively. Zillow ranked the Salt Lake City metro as the third most affordable metro for renters in the United States, and Redfin ranked Salt Lake City as the fourth most affordable metro in the nation.  

Wages have generally increased nationwide, and Redfin’s report looked into this wage growth to better understand affordability. Using Census Bureau data, they estimated that the median income for American renters increased by 5.3% in 2024. They found this increase in median wages was greater than the increase in rent prices, thus making rent more affordable nationwide. Still, the median renter in the United States is allocating 34.9% of their income to housing expenses. For the Salt Lake City metro, Redfin determined that the median renter is allocating roughly 27.5% of their income for housing, while Zillow’s report suggests that Salt Lake City renters are able to allocate an even smaller proportion of their income to housing, at 19.9%.  

CoStar suggests that the decrease in rental prices is likely due to the completion of many multifamily housing units in 2024. While this is true, 2024 also saw much fewer multi-family housing units begin construction than had begun in previous years. For Salt Lake City metro  to maintain housing affordability while growing in population and opportunity, building additional units will remain important to meet growing demand.  

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