Rental Demand Shifts to Cheaper Markets Signal Future Home Sales Trends
A new Zillow report shows that as U.S. rent prices rise, more renters are relocating to cheaper markets. Buffalo, New York; Chicago; and Houston lead in out-of-town rental searches on the platform, followed by New Orleans and Dallas. These trends often precede home sales activity, suggesting a potential shift in buyer interest toward these more affordable areas. The report highlights that cities like Salt Lake City, Raleigh, Hartford, and Nashville are experiencing significant in-migration, with out-of-town searches now surpassing local ones. Zillow's chief economist notes this growing trend indicates an emerging pipeline of newcomers who may eventually transition from renting to buying homes. These markets also tend to have lower home prices compared to the national median. While rents had been declining over recent years due to increased supply, they are beginning to rise again in August for the first time in four years. Despite this uptick, rental costs remain slightly below those of 2025 levels.
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Topics: housing prices real estate migration rental market Zillow data