The nation's rental market continues to strengthen with some big cities seeing rents rise nearly 15% compared to a year ago.
Nationally, median rents rose 2% from February 2011 to February 2012, while home values fell 4.5% during that period, according to online real estate marketplace Zillow (Z).
Chicago metro rents increased 8.6% over the past year, in comparison to an 11% fall in home values over the same period. In the Philadelphia metro, rents rose 14.8% annually while home values fell 5.4% year-over-year.
The Zillow rent index showed year-over-year gains for nearly 68% of metropolitan areas covered by the index. In comparison, only 8% of metro areas covered saw home values rise in the company's home value index.
Foreclosures continue to drive down home values, Zillow said. Foreclosure re-sales made up 20.3% of all sales in February, up from 19.3% in February 2011 and nearly flat with their previous peak of 20.2% of all sales in March 2011.
Foreclosure sales are strongly affected by seasonality, with January and February typical months with high percentages of foreclosure sales.
“We have made it through the worst of the housing recession with a bottom on the horizon, but the deep backlog of foreclosures, elevated negative equity and high unemployment are all still obstacles on the road to recovery,” said Zillow Senior Economist Svenja Gudell.
“The rental market remains a bright spot in the housing market, where many markets, especially hard hit ones, are experiencing significant annual rent appreciation and drawing the attention of investors."
In the short term, estimated national monthly rents declined slightly from January to February, falling 0.5% to $1,212. Home values fell 0.5% during the same period to $145,400.
The rent estimate is the rent on a given day and includes the value of all single-family residences, condominiums, cooperatives and apartments in Zillow’s database.
Click here after 7 a.m. central on Tuesday to see the full, interactive report.