FAYETTEVILLE, Ark. (KNWA/KFTA) — Year-over-year rent increases in Arkansas were among the highest in the country, according to a recent report.

The website Rent.com’s January 2023 Rent Report highlighted trends and price fluctuations across the United States. The study compared rent prices across different bedroom types to determine which areas became more or less affordable for renters.

The study analyzed rental property prices in December 2022 and found that prices in Arkansas increased 17.5 percent, the 4th-highest of any state. Only Florida, New York and South Dakota saw bigger rental price hikes.

Economist at the University of Arkansas, Jeff Cooperstein, said the high demand for homes and the small supply of them contributes to the high rent.

“We’re building apartments and housing but not as fast as is needed to really keep up with the demand,” Cooperstein said.

In Northwest Arkansas, house prices are also going up which has a trickle-down effect to rent prices.

“It means that you as the owner of apartment complexes can also push your rent because you’re a substitute product,” Cooperstein said.

Nearby states Tennessee and Mississippi also saw double-digit increases in rental prices. Ten states saw those prices fall, with Idaho having the biggest drop at 5.4 percent.

Nationally, year-over-year rental rates rose by 4.77 percent, which was the lowest yearly change since July 2021. This was the fourth straight month of single-digit increases.

Looking at the 50 most populous U.S. metropolitan areas, Salt Lake City saw the largest yearly increase at 29.8 percent. Raleigh-Cary, North Carolina was the only other one with a rise of over 20 percent.

NWA Council’s Workforce Housing Center is working to address the lack of affordable housing in the region. Executive Director Duke McLarty said the organization is working to increase the supply of places to rent.

“We’re focused on development that is going to serve our workforce and thinking of the proximity and location of that development near our employment centers, near our schools and universities,” McLarty said.

McLarty said the council is working with cities to target areas where more affordable housing can be built and being strategic about how it’s being built.

“We need to think about development that does condense the lot size and brings people closer together,” McLarty said.

More information from the report is available here.