Austin, Texas, a COVID-19 pandemic boomtown, can no longer claim to be the top market in the country as rent prices have continued to fall for the eighth consecutive month for a yearly total loss of 4.7%.
As such, the national median rental price now stands at $1,722. While that number is down, it is only down $36 from its peak which occurred in August 2022 but up $313 more than in the pre-pandemic times in March 2019.
Top 10 markets with the largest yearly rent price declines include: Austin-Round Rock, Texas (-4.70%); Memphis, Tennessee-Ms.-Ark. (-4.40%); St. Louis, Missouri (-4.00%); Atlanta-Sandy Springs-Roswell, Georgia (-3.70%); Miami-Fort Lauderdale-West Palm Beach, Florida (-3.60%); Phoenix-Mesa-Scottsdale, Arizona (-3.20%); Nashville-Davidson–Murfreesboro–Franklin, Tennessee (-2.90%); Orlando-Kissimmee-Sanford, Florida (-2.80%); Tampa-St. Petersburg-Clearwater, Florida (-2.50%); and Cleveland-Elyria, Ohio (-2.50%).
“Rising shelter costs have been a major driver of overall inflation, a top concern for the Fed as it meets this week,” said Danielle Hale, Chief Economist for Realtor.com. “There is some good news for renters with prices falling in many parts of the country, especially outside expensive metro markets in the West and Northeast.”
“However, we expect cost pressures to continue as interest rates remain high and would-be buyers opt to rent instead and keep demand high,” Hale continued. “New housing construction is needed, especially in major markets in the Northeast and West, to alleviate the home supply shortage. Softer rents in the South are evidence that more supply helps tame rising costs.”
In Austin—and the South in general—unemployment is low and demand for rental housing is strong, but an influx of new units has helped push down rental prices. But in the West, labor markets remain relatively robust, and demand for rental housing is outstripping supply, which in turn are propping up prices.
By the numbers
- Rental units of all sizes saw median rent declines in March 2023
- Studio apartments recorded the largest drop, falling 1.4% year-over-year to $1,435 per month. This marks the seventh consecutive month of falling studio prices, but this number is still 17.6% higher than it was five years ago.
- One-bedroom apartments fell by a minute 0.1% year-over-year to $1,602 per month.
- Two-bedroom apartment rents fell 0.5% year-over-year to $1,908 marking eight months of steady declines. However, the larger two-bedroom dwellings still have the highest growth rate over the past five years, rising by $372 (or 24.4%) over that time.
Click here to see the report in its entirety, including a larger list of statistics for the top-50 metropolitan areas.
