The US single-family rental market remains strong, but the pace of rent growth has slowed significantly over the past year. The market looks more like 2019 than the price spike seen during the pandemic.
U.S. single-family home rent growth recorded a 3.7% increase in May, compared to a 14.2% increase in the same month in 2022, according to the . core logicSingle Family Rent Index (SFRI). The index, which analyzes changes in single-family rental prices across the country and metropolitan areas, fell for the 12th straight month in April on an annualized basis.
With the exception of Las Vegas, which fell less than 1%, most metropolitan areas experienced single-digit annual rent growth for single-family homes.
“Single House Rent” growth “Growth slowed over the course of the year, with overall growth approaching pre-pandemic levels,” said Molly Boesell, chief economist at CoreLogic. “Prior to 2020, single-family rent growth hovered in the 2% to 4% range for nearly a decade. , rents increased by 26%.”
Vosel also noted that rent growth has “bottomed out,” meaning that the rise in single-family rents over the past three years is more or less permanent. At pricing levels below this, affordability becomes harder and tenants spend a larger portion of their monthly budget on rent.
CoreLogic researched rental prices in four stages. Low price range (75% or less of the regional median), low-middle price range (75%-100% of the regional median), and medium-high price range (100%-125% of the regional median). area median), highly priced (more than 125% of the area median), and there are two tiers of property types: attached and detached. The low-end category grew at 6%, while the other three categories grew at 4.6%, 4.1%, and 2.4%. Single-family rental prices increased by 2.6%, while ancillary property prices increased by 4.6%.
Of the 20 metropolitan areas surveyed, April 2023 saw the highest year-over-year growth in single-family home rents in Charlotte, North Carolina, at 6.9%. Boston and Orlando, Florida, recorded the next highest annual growth rates at 6.2% and 6%, respectively. Las Vegas, the worst-performing market, experienced a -0.8% drop in annual rent prices. Phoenix Subway rents rose just 0.1% a year in April, while Seattle Subway rents rose just 0.3%.
