Santa Cruz, a coastal community south of San Francisco, has been identified as the most expensive rental market in the United States, according to a report by the National Low Income Housing Coalition. The designation challenges common assumptions that New York, Miami, or San Francisco would hold the top spot.
The report, titled “Out of Reach,” indicates that California leads the nation in rental costs. Renters in the state need to earn $52.79 per hour to afford a typical two-bedroom home, which averages $2,745 per month. However, the costs are significantly higher in the Santa Cruz-Watsonville area, where an hourly wage of $81.04 is required to rent a two-bedroom residence.
The greater Santa Cruz area includes Capitola and surrounding coastal and agricultural communities. Santa Cruz itself is home to the University of California Santa Cruz and has faced a persistent housing crisis, with students and residents reporting a highly competitive rental market.
According to the National Low Income Housing Coalition, eight of the ten most expensive metropolitan areas in the U.S. are located in California. These areas are categorized by HUD Metro Fair Market Rent Area designations. Following Santa Cruz, the top six most expensive areas include San Francisco and Marin, Santa Clara County, the Napa wine country region, Orange County, and Santa Barbara.
The Oakland-Fremont area ranks eighth, while Boston and New York City are listed seventh and tenth, respectively. In California, approximately 6 million households, or about 44% of the state's 13.5 million total households, are renters.