Rents continued to fall in April with renters in Austin, Texas; Las Vegas; and San Francisco seeing large savings, according to Realtor.com’s Rental Report. In contrast, three Midwest markets saw surging rents.
The national median asking rent for zero to two-bedroom units fell by -0.7% from April 2023 to $1,723, and declined across all size categories. Although the pace of rent declines has slowed, it was the ninth straight year-over-year drop. Rents are $33 (-1.9%) below their August 2022 peak.
"In the ever-fluctuating real estate market, renters will find that trends vary significantly by location," says Danielle Hale, chief economist at Realtor.com. "Renters in some historically expensive areas are seeing lower prices compared to what they would have paid at the peak of the market, while many relatively affordable markets are witnessing a continued rise in rental costs to new highs, and the scales could tip to even more markets later this summer."
For Austin, the median asking rent in April was $1,494, down $195 (-11.5%) from its September 2022 peak. Realtor.com says the decline was partly driven by an influx of new multifamily homes in the market, which has pushed Austin's rental vacancy rate higher. Rents in Austin have been declining month over month since June 2023. However, its median asking rent is still $260 (21.1%) more than it was five years ago.
The market with the second-biggest rent savings since the peak was Las Vegas. Renters could save $184 on average by renting a typical property, down -11.1% from the June 2022 high. In San Francisco, a typical renter could save $303 per month, down -9.9% from the July 2022 peak.
Conversely, the median asking rents hit their highest levels since March 2019 in three Midwest cities: Indianapolis (up 4.5% annually to $1,334), Milwaukee (up 3.8% to $1,671), and Minneapolis (up 2.5% to $1,529). Below-average unemployment rates and the slow pace of new multi-home construction are driving rents higher, Realtor.com notes. Additionally, the current rental prices in Cincinnati, Cleveland, and Chicago are all slightly below peak but could hit their own record highs this summer if the recent growth trend continues.
Across unit sizes, studios saw the greatest drop, with the median asking rent nationwide dropping by 1.7% on a year-over-year basis, to $1,443, which is down -3.2% from its October 2022 peak but 18.9% higher than five years ago. Median rent for one-bedroom units dropped -1.4% to $1,601, marking the 11th straight month of annual declines. And the median rent for two-bedroom units fell by -0.7% to $1,916, which is -1.9% lower than its August 2022 peak but 24.4% more than five years ago.
