The median U.S. asking rent fell $12 to $1,717 in November, the seventh consecutive month of year-over-year declines, according to a new report from Realtor.com.
Realtor.com’s November Rental Report found that the median rent price was down $59 from the peak seen in July 2022, but still $313 (22.3%) higher than the same time in 2019 (pre-pandemic). The report also stated that although seasonality and recent momentum in the rental market make it very unlikely the market will see a new peak rent in 2023.
Breaking down the rent changes for different units, studio rents dropped 0.9% to $1,442, one bedroom rents dropped 0.6% to $1,594, and two bedroom rents dropped 0.6% to $1,904.
Key highlights:
- The median rent in the West was -2.3% lower than a year ago. Specifically, big metros such as San Francisco (-2.8%) and Los Angeles (-3.8%) continued to see year-over-year rent declines.
- In contrast, rents in populous northeastern metros such as New York City (5.6%) and Boston (6.1%) continued to experience faster growth.
- Rent growth in Midwest metros registered a rate of 2%. As the Midwest markets tend to have greater affordability, the stronger growth in these markets likely results from this benefit even as it may reduce existing affordability.
- Specifically, Milwaukee (5.4%), Cleveland (4.1%) and Cincinnati (2.9%) emerged as the top-performing markets with the fastest year-over-year growth in the Midwest.
- The median asking-rent for 0-2 bedroom rental properties in the South was 0.4% lower than one year ago. Specifically, the top 3 metros experiencing the most significant year-over-year rent declines are Orlando (-6.0%), Austin (-5.4%) and Dallas (-4.1%).
Major takeaway:
“The tide is turning and rents continued to fall in November, for the seventh straight month, following almost a full year of double-digit rent growth between mid-2021 and mid-2022. With peak prices likely behind us, renters may finally be able to finally breathe a sigh of relief,” said Realtor.com Chief Economist Danielle Hale. “Looking ahead to 2024, we expect affordability conditions will continue to improve slightly, with a -0.2% drop in rent prices for the year, as more rental supply comes to the market and slightly outpaces rental demand. This will also contribute to further improvement in inflation, much of which is currently driven by rising shelter costs.”
For the full report, click here.
