Residential Rent Growth Slows to 2 Year Low in U.S.

Residential Rent Growth Slows to 2 Year Low in U.S.

Residential News » San Francisco Edition | By WPJ Staff | September 5, 2023 7:04 AM ET

According to national home rental platform Zumper, the U.S. slowdown of price increases observed over the last year continues this month, with one-bedrooms up less than half a percentage point over last month and two bedrooms up just a tenth of a percentage point.

At 1.6 percent, the year-over-year increase in one-bedroom median rent is the smallest year-over-year increase seen in more than two years. These numbers are proof positive that the wild price swings during the pandemic will take even more time to normalize.

Zumper CEO Anthemos Georgiades says, "Many renters are still in a wait-and-see mindset. Americans' nerves about economic uncertainty have been somewhat soothed by slowing inflation, but there are certainly lingering fears following the roller-coaster ride our economy--and the rental market--have been on for more than three years. We expect rental rates to continue doing exactly what we've seen over the last year: gradually slow down and settle into seasonal patterns."

The smoothing out of pandemic-era anomalies is especially apparent in Zoomtowns that were once remote-work darlings but haven't retained enough residents to sustain drastic price increases.

Boise, for example, dropped six spots this month; its median one-bedroom rent of $1,330 is down 6.3 percent month-over-month and down 8.3 percent year-over-year. During the height of the pandemic, Zumper reported year-over-year increases in Boise of nearly 25 percent. In September 2021, Boise's median one-bedroom rent was nearly 8 percent above the national median. This month, its one-bedroom median of $1,330 is 12 percent lower than the national figure. 

Even enduring hot spots like Miami and Nashville are down slightly this month, while prices in red-hot Jersey City are softening following the area's breakneck price increases over the last two years.

Similarly, cities that lost residents during the height of remote work continue to slowly recover. Chicago's one-bedroom median is up 6 percent over last month and up nearly 16 percent over last year.



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