Rent prices have gone down annually for the 14th month in a row.
The Weird Reason Rents Are Rising in the Midwest—But Falling Down South
In September, the median asking rent in the 50 largest metros was $1,743, which is $8 less than what renters paid last year at this same time, according to a new Realtor.com® report.
The average rent for a two-bedroom apartment in September was $1,930, down $8 year over year; a one-bedroom apartment was $1,623, down $8; and a studio was $1,442, down $34.
Where rents are rising—and why
Even though rental prices dropped overall in September, the rental market itself is experiencing a regional divide.
Eight of the 10 Midwestern markets in the largest 50 metros saw annual rent increases in September.
The balance between housing supply and demand is a key factor shaping regional rent patterns,” says Danielle Hale, chief economist at Realtor.com.
Because of the Midwest’s strong affordability and robust labor market, demand has outpaced supply, Hale says, which has resulted in rising rents.
The average unemployment rate across the top 50 metros was 4.2% in August. But in areas like St. Louis and Minneapolis—where the unemployment rate was lower than average at 3.9%—you often see rent increases.
Additionally, year-over-year growth rates persist in some of the most expensive rental markets in the West and Northeast, such as San Jose, CA, (up 2.6%) and New York, NY (up 2.8%).
“Despite weak labor market conditions, demand in these populous markets continues to outstrip limited rental supply,” says Realtor.com economist Jiayi Xu. This drives rents higher.
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Cities where rent is rising fastest
The city with the fastest-rising rent is Cincinnati, where rents grew over the past year by 3.4% to a median of $1,393.
Here are the other markets where rental prices rose the most:
Washington, DC
Median asking rent: $2,293
Year-over-year growth rate: 2.9%
New York, NY
Median asking rent: $2,973
Year-over-year growth rate: 2.8%
St. Louis, MO
Median asking rent: $1,361
Year-over-year growth rate: 2.6%
San Jose, CA
Median asking rent: $3,377
Year-over-year growth rate: 2.6%
Louisville, KY
Median asking rent: $1,287
Year-over-year growth rate: 2.5%
Sacramento, CA
Median asking rent: $1,954
Year-over-year growth rate: 2.4%
Minneapolis, MN
Median asking rent: $1,555
Year-over-year growth rate: 1.9%
Oklahoma City, OK
Median asking rent: $1,037
Year-over-year growth rate: 1.9%
Portland, OR
Median asking rent: $1,737
Year-over-year growth rate: 1.9%
Why rents are falling down South
Eight out of 10 of the markets with the steepest annual rent declines last month were in the South.
Hale says a surge in new multifamily housing developments in the region is “easing competition among renters and driving down prices.”
Where rents are falling fastest
Out of the top 50 metros, renters saved the most money year over year in Nashville, TN.
Rent decreased by 4.8% year over year there, so the median asking rent is now $1,578.
Here are the other cities where rents declined the most:
Dallas, TX
Median asking rent: $1,475
Year-over-year decline: 4.0%
Denver, CO
Median asking rent: $1,889
Year-over-year decline: 4.0%
Austin, TX
Median asking rent: $1,522
Year-over-year decline: 3.7%
Birmingham, AL
Median asking rent: $1,251
Year-over-year decline: 3.5%
Memphis, TN
Median asking rent: $1,227
Year-over-year decline: 3.5%
San Diego, CA
Median asking rent: $2,828
Year-over-year decline: 3.4%
Atlanta, GA
Median asking rent: $1,610
Year-over-year decline: 3.2%
Miami, FL
Median asking rent: $2,372
Year-over-year decline: 3.1%
San Antonio, TX
Median asking rent: $1,268
Year-over-year decline: 3.1%
Source: Realtor.com
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