A rise in household formation and the prohibitively high cost of homeownership in many US metros has pushed apartment rents up 11% in the first half of the year, according to a new report from Apartment List. The increase is more than double the rate of inflation and triples the rent growth the firm measured in the years leading up to the pandemic.

Rents have rebounded to pre-pandemic prices in 87 of the largest 100 US cities, and are up 30% since March in cities like Boise, Bend, Ore., and Spokane. That growth is being partially driven by household formation, which is at a historic peak, and major disruptions in apartment construction starts (which have in turn led to record lows in builder confidence). And in many US metros, the supply of available homes to purchase, combined with sky-high prices, are putting homeownership out of reach for many renters. Home inventory dropped by 48% year-over-year in March 2021, while the Case-Shiller home price index is up nearly 8% through May of this year.

"As supply shrinks and prices soar, more and more relatively high-income households are unable to find for-sale housing that meets their needs and preferences. These households therefore remain in the rental market, where they put additional pressure on affordability," the Apartment List report states. "Post-pandemic apartment hunters are searching with higher incomes and higher budgets, especially when moving to a new part of the country. These are the renters who, if not for prohibitively high prices, might otherwise buy homes and take some pressure off the rental market."