NAHB has developed a model to estimate the average gross rent for an apartment in a building with five or more housing units. Gross rent includes the amount the tenant pays to the property owner, plus the costs of all utilities except the telephone, irrespective of who directly pays them. By changing the age, features, location and other inputs, the model can be used to estimate how a particular amenity tends to impact the rent that tenants can expect to pay and property owners can expect to collect.
The model was developed by applying well-established statistical techniques to data from the American Housing Survey (conducted by the U.S. Census Bureau and sponsored by the Department of Housing and Urban Development).
Due to the limited geographic detail available in the survey, all results produced by the estimator model represent average gross rent across a broad region, rather than rent for a particular apartment in a specific location. Rents within a region may vary substantially. The gross rent for an apartment in suburban Chicago, for example, may be different from the rent for an otherwise similar apartment in the suburbs of other Midwestern metro areas.
Also, no survey or statistical model can possibly capture all features with a potential impact on gross rent, so there's always a chance that a particular feature in the model is acting partly as a proxy for others. For example, if larger apartments tend to have higher quality appliances, the estimated impact of the apartment’s size could be picking up part of the effect of upgraded appliances, as well as the value of the extra square footage.
Subject to these caveats, the apartment rent estimator has several potential uses, including the following:
- Builders and prospective renters may use it to get an idea of how a particular amenity affects the rents tenants can expect to pay and property owners can expect to collect.
- Households contemplating a different apartment may use it as a preliminary search tool, to get a rough idea of the cost of different amenity packages.
- Owners of rental properties may use it to help judge how a particular renovation would tend to increase the rent they can charge.
- Developers may use them to help evaluate the desirability of potential building sites.
- Local governments and community organizations may use it to estimate the economic effect of policies that alter neighborhood conditions.
In order to access the apartment rent estimator, you will need to have Microsoft Excel installed on your computer. You will also need to adjust Excel’s security setting to allow macros to run before you open the file. The security options differ somewhat depending on the version of Excel. In the latest version, security is set from the “Developer” tab which may not automatically be displayed in Excel’s ribbon.
If your computer has Microsoft Excel with “Security” set to allow macros to run, you can access the NAHB apartment rent estimator.
Please note that we have encountered compatibility problems with Mozilla Firefox, as well as particular versions of some other web browsers. In addition, some internet service providers may apply security or other procedures that prevent the estimator from running properly. If you have trouble running the estimator, try accessing it from a different computer with a different browser, if possible.