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 0.6% month-over-month, down 0.6% year-over-year
Welcome to the January 2025 Apartment List National Rent Report. The national median monthly rent closed out 2024 at $1,373 in December, after declining by 0.6 percent, or $8, from the prior month. Year-over-year rent growth nationally also currently stands at -0.6 percent, meaning that the typical apartment is currently renting for slightly less than it was one year ago.
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 in 2021 and the first half of 2022, the national median rent has now fallen below its August 2022 peak by a total of 4.8 percent. But despite the cooldown, the typical rent price remains 20 percent higher than its January 2021 level.
On the supply side of the rental market, our national vacancy index continues trending up slowly and currently 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. 2024 saw the most new apartment completions since the mid-1980s, and with nearly 800 thousand units still in the construction pipeline, the supply boom has runway to continue into 2025.
Realtor.com: 16th Consecutive Month with Year-over-year Decline in Rents
In November 2024, the U.S. median rent continued to decline year-over-year for the sixteenth month in a row, down $19 or -1.1% year-over-year for 0-2 bedroom properties across the top 50 metros, faster than the rate of -0.8% seen in October 2024. The median asking rent was $1,703, down by $17 from last month, reflecting a similar seasonal trend as observed in the for-sale market.
Despite the sixteenth month of decline, the U.S. median rent was just $57 (-3.2%) less than the peak seen in August 2022. Notably, it was still $261 (18.1%) 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 November 2024) and pales in comparison to the 49.7% increase in median price-per-square-foot of for-sale home listings in the 5 years ending November 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 a rising price level.
CoreLogic: Rents Increase 1.7% YoY for Single-Family
Annual U.S. rent growth registered a 1.7% increase in October, down from the 2.3% growth rate seen at the same time last year and marking the lowest rate since June 2020. Prior to 2020, single-family rent growth increased in the range of 2% to 4% for nearly a decade and averaged 3.5%.
The monthly growth rate for October was -1.5%, which was below the average -0.5% for October from 2004 through 2019. This marks the third consecutive month of below-trend seasonal growth, a clear sign that rent growth is decelerating.
“Single-family rents posted below-trend growth in October, both in annual and monthly rate increases. While national growth was below-trend, some markets, particularly markets that have had tepid rent increases over the past two years, led rent increases for the nation,” said CoreLogic senior principal economist Molly Boesel. “Markets in the South and West, many of which had red-hot rent growth since 2022 brought down average rent growth.”
The 1.7% YoY increase for single-family homes in October was down from 2.0% YoY in September.
Real Page on Rents: “Still-muted 0.5% growth in calendar 2024”
[R]ent change remained flat under the weight of near-historic new supply volumes. U.S. apartment rents were cut on a monthly basis in each of the final three months of 2024, but those cuts were slightly less deep than the year-earlier rent cuts, appearing to marginally boost rent growth to a still-muted 0.5% growth in calendar 2024.
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.
