Tracking rents is important for understanding the dynamics of the housing market. Slower household formation and increased supply (more multi-family completions) has kept asking rents under pressure.
More recently, immigration policy has become a negative for rentals.
Rents are up 0.5% month-over-month, down 0.3% year-over-year
Welcome to the May 2025 Apartment List National Rent Report. Our national rent index increased by 0.5 percent in April, marking the third consecutive month-over-month increase. Year-over-year growth remains negative at -0.3 percent, but is slowly inching back toward positive territory. In dollar terms, the national median monthly rent now stands at $1,392, up $7 per month compared to last month, but down $4 compared to April 2024.
Since the second half of 2022, rent prices have continued to ebb and flow with the seasons as they typically do, but with the overall trajectory trending modestly downward. Following a period of record-setting rent growth through 2021 and the first half of 2022, the national median rent has now fallen below its August 2022 peak by a total of 3.5 percent, or $50 per month. But despite the cooldown, the typical rent price remains 21 percent higher than its January 2021 level.
On the supply side of the rental market, our national vacancy index ticked up to 7 percent, setting a new record high in the history of that monthly data series, which goes back to the start of 2017. After a historic tightening in 2021, multifamily occupancy has been slowly but consistently easing for over three years amid an influx of new inventory. 2024 saw the most new apartment completions since the mid-1980s, and although we’re past the peak of new multifamily construction, this year is still expected to bring a robust level of new supply.
Realtor.com: 20th Consecutive Month with Year-over-year Decline in Rents
In March 2025, the U.S. median rent recorded its 20th consecutive year-over-year decline, dropping 1.2% for 0-2 bedroom properties across the 50 largest metropolitan areas. The median asking rent stood at $1,694, reflecting a modest $4 increase from the previous month. This uptick aligns with the typical seasonal trend, where rents tend to rise in the spring and summer before softening in the fall and winter.
The typical asking rent is $2,005 in March, up 0.6% month-over-month. The pre-pandemic average month-over-month change for this time of year is 0.7%.
Since the beginning of the pandemic, rents have increased by 34.7%.
Rents are now 3.5% up from last year.
Rent Data
Here is a graph of several measures of rent since 2000: OER, rent of primary residence, Zillow Observed Rent Index (ZORI) and ApartmentList.com (All set to 100 in January 2017).
OER and rent of primary residence have mostly moved together. The Zillow index started in 2015 and the ApartmentList index started in 2017.
Note that new lease measures (Zillow, Apartment List) dipped early in the pandemic, whereas the BLS measures were steady. Then new leases took off, and the BLS measures have followed.
Here is a graph of the year-over-year (YoY) change for these measures since January 2015. Most of these measures are through March 2025, except Apartment List through April 2025.
The Zillow measure (single and multi-family) is up 3.4% YoY in March, down from 3.5% YoY in February, and down from a peak of 15.9% YoY in February 2022.
The ApartmentList measure is -0.3% YoY as of April, unchanged from down 0.3% in March, and down from a peak of 17.9% YoY November 2021.
The ApartmentList measure reflects new leases, whereas most rental units don’t turnover every year (as captured by the BLS measures). The sharp increase in new lease rates in 2021 and early 2022 has been spilling over into the consumer price index (as discussed in earlier article).
The Rent of primary residence was up 4.0% YoY in March down from 4.1% YoY in February. The Owners’ Equivalent Rent (OER) was up 4.4% YoY in March, unchanged from 4.4% YoY in February. The YoY change in OER and in PCE will stay elevated for some time, even though asking rent growth has mostly flattened YoY.
Conclusion
The story mostly remains the same although it might start to change later this year. There will still be a significant amount of new supply coming on the market in 2025, but the pace of new supply is declining.
However, it is possible that policy (less immigration, more deportations) could put more downward pressure on rents. The tariffs might also hurt rentals - indirectly - since renters will be paying more for other goods.
The government measures of housing inflation (CPI and PCE reports) will likely continue to slowly decline throughout 2025.
CalculatedRisk Newsletter is a reader-supported publication. To receive new posts and support my work, consider becoming a free or paid subscriber.
Thanks for reading CalculatedRisk Newsletter! This post is public so feel free to share it.
