Philly Rents Saw Minimal Growth In 2024 Despite Strong Demand For Apartments

Rents rose significantly in urban areas not far from Philadelphia last year, but the city itself remains a relative bargain.

The median price of a one-bedroom apartment in Philly grew by just 1.3% year-over-year while other nearby locales like Wilmington, Delaware and Allentown, Pennsylvania, saw the metric expand by 7.7% and 6.3%, respectively, according to a Zumper report based on December 2024 data. 

The city is still working through a glut of new apartments after developers expedited multifamily projects to capitalize on a tax abatement program that expired in 2021.

That doesn’t mean there’s no cause for landlord optimism.

“Seeing the Philadelphia annual rates up at all after so much supply entered the market last year is really a testament to how large the demand for housing is in Philly,” Zumper Associate Director of Communications Crystal Chen told Bisnow.

One-bedroom rents in the city fell by 1.3% month-over-month, which she attributed to predictable annual drops in leasing activity during the winter. But Chen was already seeing that trend begin to reverse in the first weeks of the new year.

“The fact that we’re seeing rents rise in January already would point to some increases, especially as we get into the summer when there’s a lot more competition,” she said.

Supply in Philadelphia is high, but so is demand. The city was the third most popular relocation destination for renters last year after Chicago and Portland, Oregon, according to a separate Zumper report from last year.

Many of those migrants to Philly are coming from pricier East Coast markets like Boston, Washington, D.C., and especially New York City.

“New York rent is a joke,” Chen said. “Anecdotally, I’ve definitely heard about people moving out of New York to satellite cities.”

The Big Apple-to-Philly pipeline got a big boost from the coronavirus pandemic in 2020, and it continued in the years that followed. 

Fifteen percent of all out-of-staters who moved to Center City between 2021 and 2023 came from New York, according to a Center City District report released last year. That was more than any other state. Runner-up Florida accounted for just 6% of new residents in the neighborhood.

“In 2023, more residents moved from New York City than the years prior,” the report said.

But even with this strong demand, Chen said Philly landlords shouldn’t expect sizable rent increases in the short term.

“I don’t expect the annual rates to get into the double digits or anything,” she said. “There is still more new supply coming onto the market this year, so I’m not expecting anything crazy.”

The Zumper report highlighted some dramatic rent shifts in neighboring New Jersey, however.

Trenton saw one-bedroom rents jump nearly 27% year-over-year. The city is experiencing high demand since 62% of households there are comprised of renters, Chen said. New builds in the state capital may also be driving up median prices, she said.

Princeton was the most expensive locale on the regional list, with the median price for one-bedroom apartments sitting at $2,810 per month. But the college town saw that metric drop by 3.8% year-over-year. Asking rent for two-bedroom apartments fell by 11.3%.

Chen doesn’t believe these shifts indicate a dramatic change in fortunes for the city. Zumper has a much smaller pool of available rentals in Princeton and Trenton, which makes the company’s data for those locales more volatile. Its website has about 5,000 listings for Philly and roughly 40 and 60 in Trenton and Princeton, respectively.

“I wouldn’t say people are fleeing Princeton at all,” she said. “I just feel like maybe rents last year were really high for two-beds in Princeton.”