Money Matters - Upsizing Costs

Nevada families who outgrow their two-bedroom rental face a 40.7% increase to their monthly housing expenses should they wish to add another bedroom. On average, a two-bedroom home costs $1,605 to rent, compared to $2,258 for a three-bedroom property.

This is according to a new study from LA property management firm RentalHouse Property Management, which analyzed US rental price data from the 2024 Out of Reach Report by The National Low Income Housing Coalition (NLIHC). By measuring rent price differences depending on the number of bedrooms, they estimated how much it costs to move to larger homes in each US state, county and metro area.

 

“After analyzing rent prices for studios up to four-bedroom homes, we found the biggest leap expanding families face is when they want to upsize from a two-bedroom to a three-bedroom home,” says Paul Kiledjian, CEO of RentalHouse Property Management. “This transition is consistently the most expensive in all US states.”

 

“On average, that extra third bedroom hikes up your rent by 31%. This is the point where many families consider buying their own home. They would rather spend at least a year in a more crammed, rented space but save up for their own home.”

 

A third of US households (32.9%) rent rather than own. Tenants wanting to upsize can expect this to cost around 19.5%, on average, for each extra bedroom. Specifically, upgrading from a studio to a one-bedroom home adds 9.3% to your rent. Another bedroom will see your rent increase by 21.8%. Americans can expect to pay 31% more when swapping a two-bedroom home for a three-bedroom property. The next upgrade, from a three-bedroom place to one with four bedrooms, will cost 15.8% more.

 

Alaska is the most expensive state to upsize in where each extra bedroom costs an average of 24.2%. Going from a two-bedroom home to a three-bedroom property adds $572 in monthly rent.

 

Tenants who upsize in Hawaii, Idaho, and South Dakota face the second steepest rent increases in the US, averaging 24%, 23.8% and 23.6% per extra bedroom, respectively. Similarly to the rest of the country, going from a two-bedroom home to a three-bedroom property affects renters’ pockets the most. In Hawaii, this switch adds $903 – the largest amount a one-bedroom upsizing costs in the entire country. In Idaho, this translates into $484 more per month, whereas in South Dakota this is $365 more.

 

New York is the most convenient state to upsize in, meaning the rent increase is the least steep here, averaging just 13.2% per bedroom. It is consistently in the top five most expensive states to rent, no matter the home size. It is also where residents own the least of their homes, with 45.7% still renting.

 

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Sources: RentalHouse Property Management via The National Low Income Housing Coalition’s 2024 Out of Reach report.

 

Notes for Editors:

• Post courtesy of RentalHouse Property Management to https://rentalhousepm.com/
• Methodology:

1. The researchers used data from the National Low Income Housing Coalition (NLIHC)’s 2024 Out of Reach report.
2. Statistics on Fair Market Rents (FMRs) at the 40th percentile were collected for studios, as well as one-, two-, three-, and four-bedroom units across all US states, counties, and metro areas. For each unit size, the percentage difference from upsizing by one bedroom (e.g. from a three-bedroom to a four-bedroom; from a two-bedroom to a three-bedroom, etc.) was calculated. These four percentage values were then averaged to determine the average rent increase per added bedroom.
3. Regions were then ranked based on this average to reveal where upsizing yields the least financial burden. Separate rankings were produced for states, counties and metro areas, with in-state rankings for counties and metro areas. Where values appear to be the same, decimals determined which ones were in fact higher or lower.