Rate of rental price declines slows

A new residential rental price report from Realtor.com found that median rents for 0- to 2-bedroom homes in the top 50 U.S. metro areas increased 21.2% in June compared to the same period in 2019. That’s while nationally, rents declined in June for the 11th straight month.

Of the top 10 markets with the highest percentage rent increases compared to the pre-pandemic period, Tampa topped the charts with a $496 (39%) increase to $1,752 in June 2024. For households, that meant an additional 8.6% bite into a typical household’s monthly gross income.

Other metros with rent growth above 30% from June 2019 to June 2024 included Miami, Indianapolis, Pittsburgh, Sacramento, Virginia Beach, New York, and Cleveland, OH, while Raleigh and Birmingham joined the top 10 with rent growth of 29%. Rents for larger units had their highest growth rate in five years, increasing by $363 (23%).

In the month of June 2024, rents in the top 50 metros decreased by $7 (0.4%) compared to June 2023. Rents decreased across all size categories, especially for smaller units. The median rent for a studio was $1,463, down $18 (1.2%) — still higher than five years ago. For a one-bedroom apartment, the decrease was $1,618, down $18 (1.1%), and for a two-bedroom apartment it was $1,939, down $6 (0.3%).

Despite the 11-month slump, the report noted that the pace of rent declines is slowing across all property sizes. The slump was worst in the South, with a 9.5% decline in Austin, 8.2% in San Antonio and 8.1% in Nashville, where supply has increased significantly. Rents also fell in western metros such as Los Angeles and San Francisco. In the Midwest, rents rose, particularly in Indianapolis, Milwaukee and Minneapolis.