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.
Rents are down 0.8% month-over-month, down 0.6% year-over-year
Welcome to the December 2024 Apartment List National Rent Report. The national median rent dipped by 0.8% in November, as we get further into the slow season for the rental market. Nationwide rent fell $12 to $1,382, and we’re likely to see that number dip one more time before the year ends.
Since the second half of 2022, the seasonal declines in rent prices that take place during the fall and winter have been steeper than usual and seasonal increases of the spring and summer have been more mild. As a result, apartments are on average slightly cheaper today than they were one year ago. Year-over-year rent growth nationally currently stands at -0.6 percent and has now been in negative territory for nearly a year and a half. Despite this, the national median rent is still about $200 per month higher than it was just a few years ago.
On the supply side of the rental market, our national vacancy index continues trending up slowly and sits at 6.8 percent, the highest reading since the onset of the pandemic. After a historic tightening in 2021, multifamily occupancy has been slowly but consistently easing for over two years amid an influx of new inventory. The third quarter of 2024 saw the most new apartment completions for a single quarter in fifty years, and with more than 800 thousand units still in the construction pipeline, the supply boom has runway to continue into 2025.
Realtor.com: 15th Consecutive Month with Year-over-year Decline in Rents
In October 2024, the U.S. median rent continued to decline year-over-year for the fifteenth month in a row, down $14 or -0.8% year-over-year for 0-2 bedroom properties across the top 50 metros, faster than the rate of -0.5% seen in September 2024. The median asking rent was $1,720, down by $23 from last month, reflecting a similar seasonal trend as observed in the for-sale market.
Despite the fifteenth month of decline, the U.S. median rent was just $40 (-2.3%) less than the peak seen in August 2022. Notably, it was still $272 (18.8%) higher than the same time in 2019 (pre-pandemic), but this increase is roughly on par with what has occurred in overall consumer prices (up 22.7% in the 5 years ending October 2024) and pales in comparison to the 50.5% increase in median price-per-square-foot of for-sale home listings in the 5 years ending October 2024. Further, the relative steadiness in rents should translate into slower shelter inflation in the months ahead, alleviating one of the biggest recent drivers of rising prices.
CoreLogic: Rents Increase 2.0% YoY for Single-Family
Annual U.S. rent growth registered a 2% increase in September, continuing a slowing trend that began in early 2024 but is well below the average annual rent growth of 3.5% that occurred in the decade prior to the pandemic. High-end price growth (2.6%) slightly outstripped low-end gains, a sign that some renters are leveraging advantageous economic conditions to upgrade – including wages that are up buy 40% since last September.
“Single-family annual rent growth slowed in September to the lowest rate in over four years, and monthly rent growth posted a second month of below-seasonal trend growth, making it clear that single-family rent growth is decelerating,” said CoreLogic principal economist Molly Boesel. “While about one-third of metros showed stronger rent growth than in the previous year, more metros showed decreases in rents than in the prior report. While a slowing in rents will be welcome news to renters, increases since 2020 are still at 32%.”
The 2.0% YoY increase for single-family homes in September was down from 2.4% YoY in August.
Real Page: “Asking rents inched up just 0.4%” Year-over-year
Much like in October, effective asking rents for professionally managed apartments ticked down on a monthly basis in November. Rents were cut 0.4% from October to November, according to data from RealPage Market Analytics. As such, effective asking rents inched up just 0.4% in the year-ending November 2024, with change measured on a same-store basis.
Rent Data
The following content is for paid subscribers only. Thanks to all paid subscribers!
CalculatedRisk Newsletter is a reader-supported publication. To receive new posts and support my work, consider becoming a free or paid subscriber.
Keep reading with a 7-day free trial
Subscribe to CalculatedRisk Newsletter to keep reading this post and get 7 days of free access to the full post archives.
