In December, U.S. median rents dropped (-0.4%)
for the eighth month in a row and across all-sized homes
SANTA
CLARA, Calif., Jan. 25,
2024 /PRNewswire/ -- The U.S. rental market
experienced a noticeable shift in momentum in 2023 and closed out
the year with eight straight months of year-over-year price
declines, according to the Realtor.com® December Rental
Report released today. While rents are overall up from pre-pandemic
levels, an uptick in supply from a building boom in recent years
means 2023 didn't see a new peak in rent prices from their 2022
highs.
In December, the median asking rent for 0-2 bedroom properties
in the 50 largest metros dipped to $1,713, down $7
(-0.4%) from the prior December and down $63 (-3.5%) from its July
2022 peak. Median rents declined across all unit sizes, and
most notably in Western metros, but are still $309 (22.0%) higher than the same time in
2019.
"The rental market took a turn in 2023 as an influx of new
multi-family apartments coming to the market exerted downward price
pressure on median asking rents, which resulted in eight
consecutive months of year-over-year price declines as we closed
out the year," said Danielle Hale,
Chief Economist at Realtor.com®. "Amid high inflation
and costs, softening rental prices throughout 2023 offered renters
a small reprieve, and looking forward, Realtor.com®
anticipates continued weakness in the rental market for 2024, as a
much-needed supply of apartment units continues to come onto the
market and further impacts market dynamics."
December 2023 Rental Metrics by
Unit Size – National
Unit
Size
|
Median
Rent
|
Rent
YoY
|
Rent Change – Dec
2019
|
Overall
|
$1,713
|
-0.4 %
|
22.0 %
|
Studio
|
$1,437
|
-1.0 %
|
16.7 %
|
1-bed
|
$1,593
|
-0.7 %
|
21.7 %
|
2-bed
|
$1,896
|
-0.4 %
|
24.8 %
|
Supply exceeds demand in West, South and pushed down prices,
while Northeast, Midwest see the opposite
Regionally,
rental trends in December mirrored patterns seen in October and
November. In the West and South, supply exceeded demand, leading to
a decrease in rents, while markets in the Northeast and Midwest
experienced more rental demand compared to supply, resulting in
sustained rent growth.
In December 2023, the median rent
in the West was 1.6% lower than a year ago. Big metros such as
San Francisco (-2.8%) and
Los Angeles (-3.5%) continued to
see year-over-year rent declines. While rental demand in the South
remains vigorous, heightened supply from a substantial 32.0% growth
in annual multifamily completion rates from January–October 2023
contributed to a downward push on rent prices, resulting in an
overall decline in rental costs. The median asking-rent for 0-2
bedroom properties in the South was -0.5% lower than one year ago.
Orlando, Fla. (-6.2%),
Austin, Texas (-5.4%) and
Dallas (-4.7%) saw the most
significant year-over-year rent declines.
In contrast, rents in populous Northeastern metros such as
New York (6.2%) and Boston (6.3%) continued to experience faster
growth, likely the result of heightened demand from a robust labor
market and slower growth in new multi-family home construction in
the region. Midwest metros, bolstered by relative affordability,
were up 2.0% from the same time last year. Specifically,
Milwaukee (5.0%), Cleveland (4.7%), Indianapolis (2.8%) and St. Louis (2.8%) emerged as the top-performing
markets in the Midwest with the fastest year-over-year price
growth.
Rental Data – 50 Largest Metropolitan Areas – December 2023
Metro
|
Median Rent (0-2
Bedrooms)
|
YOY (0-2
Bedrooms)
|
Atlanta-Sandy
Springs-Roswell, GA
|
$1,617
|
-3.90 %
|
Austin-Round Rock,
TX
|
$1,546
|
-5.40 %
|
Baltimore-Columbia-Towson, MD
|
$1,800
|
1.00 %
|
Birmingham-Hoover,
AL
|
$1,246
|
4.10 %
|
Boston-Cambridge-Newton, MA-NH
|
$2,955
|
6.30 %
|
Buffalo-Cheektowaga-Niagara Falls, NY
|
NA
|
NA
|
Charlotte-Concord-Gastonia, NC-SC
|
$1,553
|
-2.80 %
|
Chicago-Naperville-Elgin, IL-IN-WI
|
$1,837
|
-0.50 %
|
Cincinnati,
OH-KY-IN
|
$1,329
|
2.40 %
|
Cleveland-Elyria,
OH
|
$1,226
|
4.70 %
|
Columbus, OH
|
$1,177
|
1.10 %
|
Dallas-Fort
Worth-Arlington, TX
|
$1,507
|
-4.70 %
|
Denver-Aurora-Lakewood,
CO
|
$1,912
|
0.20 %
|
Detroit-Warren-Dearborn, MI
|
$1,312
|
0.30 %
|
Hartford-West
Hartford-East Hartford, CT
|
NA
|
NA
|
Houston-The
Woodlands-Sugar Land, TX
|
$1,396
|
2.40 %
|
Indianapolis-Carmel-Anderson, IN
|
$1,292
|
2.80 %
|
Jacksonville,
FL
|
$1,531
|
0.20 %
|
Kansas City,
MO-KS
|
$1,308
|
0.10 %
|
Las
Vegas-Henderson-Paradise, NV
|
$1,489
|
0.70 %
|
Los Angeles-Long
Beach-Anaheim, CA
|
$2,826
|
-3.50 %
|
Louisville/Jefferson
County, KY-IN
|
$1,243
|
5.80 %
|
Memphis,
TN-MS-AR
|
$1,258
|
-1.00 %
|
Miami-Fort
Lauderdale-West Palm Beach, FL
|
$2,368
|
-3.50 %
|
Milwaukee-Waukesha-West
Allis, WI
|
$1,613
|
5.00 %
|
Minneapolis-St.
Paul-Bloomington, MN-WI
|
$1,508
|
1.30 %
|
Nashville-Davidson–Murfreesboro–Franklin,
TN
|
$1,607
|
0.00 %
|
New Orleans-Metairie,
LA
|
NA
|
NA
|
New York-Newark-Jersey
City, NY-NJ-PA
|
$2,817
|
6.20 %
|
Oklahoma City,
OK
|
$1,002
|
3.60 %
|
Orlando-Kissimmee-Sanford, FL
|
$1,684
|
-6.20 %
|
Philadelphia-Camden-Wilmington,
PA-NJ-DE-MD
|
$1,778
|
-1.00 %
|
Phoenix-Mesa-Scottsdale, AZ
|
$1,552
|
-2.70 %
|
Pittsburgh,
PA
|
$1,440
|
0.20 %
|
Portland-Vancouver-Hillsboro, OR-WA
|
$1,658
|
-6.00 %
|
Providence-Warwick,
RI-MA
|
NA
|
NA
|
Raleigh, NC
|
$1,528
|
-2.10 %
|
Richmond, VA
|
$1,492
|
5.60 %
|
Riverside-San
Bernardino-Ontario, CA
|
$2,182
|
-3.10 %
|
Rochester,
NY
|
NA
|
NA
|
Sacramento–Roseville–Arden-Arcade, CA
|
$1,860
|
-1.20 %
|
San Antonio-New
Braunfels, TX
|
$1,275
|
0.30 %
|
San Diego-Carlsbad,
CA
|
$2,822
|
-0.10 %
|
San
Francisco-Oakland-Hayward, CA
|
$2,836
|
-2.80 %
|
San
Jose-Sunnyvale-Santa Clara, CA
|
$3,199
|
1.80 %
|
Seattle-Tacoma-Bellevue, WA
|
$1,988
|
-1.20 %
|
St. Louis,
MO-IL
|
$1,300
|
2.80 %
|
Tampa-St.
Petersburg-Clearwater, FL
|
$1,738
|
-3.60 %
|
Virginia
Beach-Norfolk-Newport News, VA-NC
|
$1,508
|
2.70 %
|
Washington-Arlington-Alexandria,
DC-VA-MD-WV
|
$2,198
|
5.20 %
|
Methodology
Rental data as of December for studio, 1-bedroom, or 2-bedroom
units advertised as for-rent on Realtor.com®. Rental
units include apartments as well as private rentals (condos,
townhomes, single-family homes). We use rental sources that
reliably report data each month within the top 50 largest
metropolitan areas. Realtor.com® began publishing
regular monthly rental trends reports in October 2020 with data history stretching back to
March 2019.
With the release of its July rent report,
Realtor.com® incorporated a new and improved
methodology for capturing and reporting more comprehensive rental
listing trends and metrics. The new methodology is expected to
yield a cleaner, more representative and more consistent
measurement of rental listings and trends at both the national and
local level. The methodology has been adjusted to better represent
the true cost of primary housing for renters. Most areas across the
country will see minor changes with a smaller handful of areas
seeing larger updates. As a result of these changes, the rental
data released since July 2023 will
not be directly comparable with previous releases and
Realtor.com® economics blog posts. However, future
data releases, including historical data, will consistently apply
the new methodology.
About
Realtor.com®
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open real estate marketplace built for everyone.
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consumers, empowering more people to find their way home by
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information, visit Realtor.com®.
Media contact: press@realtor.com
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