Based on CoreLogic's latest Single-Family Rent Index for June 2021, home rents nationwide increased 7.5% year over year, up from a 1.4% year-over-year increase in June 2020.
Hot housing market conditions have exacerbated the challenges of finding affordable rental properties for some consumers. According to a recent CoreLogic survey, 85% of consumers searching for a home said they prefer single-family homes. However, for-sale inventory remains in short supply as construction continues to lag. Not only is this keeping many would-be buyers on the hunt for single-family rentals, but it's also contributing to the dwindling availability and increasing prices of these properties. As space and affordability remain top priorities for renters, we can expect to see a similar trend as the for-sale market -- increased migration to less dense and lower cost areas.
"Single-family rent growth accelerated in June, bouncing back from last year's weak growth," said Molly Boesel, principal economist at CoreLogic. "The recovery was even more pronounced for detached rentals, which had rent growth more than double that of attached rentals. Ultimately, for would-be homebuyers who have been either priced out of the market or unable to find a home in today's supply-constrained market, detached rentals are overwhelmingly preferred -- and remain in high demand."
Among the 20 U.S. metro areas, Phoenix had the highest year-over-year increase in single-family rents in June 2021 at 16.5%. Some tourist destinations that were hard-hit by the pandemic are also showing strong signs of recovery, with Las Vegas logging the second-highest rent price growth with a gain of 12.9%. And while Boston has experienced the largest decrease in 20 metros' rent prices for 11 consecutive months now (with an annual decline of 2.7% in June) the area's rate of decline is slowing compared to previous months.
To gain a detailed view of single-family rental prices, CoreLogic examines four tiers of rental prices. National single-family rent growth across the four tiers, and the year-over-year changes, were as follows: