U.S. Rent Prices Drop in Some Cities in Oct., Pace of Growth Slows Across the Country

Nicholas E. Barron

After months of skyrocketing, rent prices grew by their lowest month-over-month amount in Oct.

Apartment List’s latest National Rent Report finds the median national rent grew by .8% last month. That compares with 1.9% growth in Sep.

And the country’s median rent is 16.4% higher than it was at the start of this year. The national median rent is currently $1,312.

While slowing rent growth may spell relief for renters, it’s not all good news for those looking to rent a place to live.

“Although the pace of rent growth has slowed down significantly from its July peak, growth is still outpacing pre-pandemic trends,” Apartment List said. “With rents continuing to rise during a time of year when seasonality normally causes prices to dip.”

Residential rents tend to drop between fall and spring, with Dec. through March usually being the cheapest time to rent, according to RentHop.

Still, the pace of rent growth is easing across the country.

Rental prices drop in some cities, but not in most

Since March, rents have been rising in all of the U.S.’s 100 largest metropolitan areas.

Thirty-five of the 100 largest metros experienced rent growth rates exceeding 20%. Since March, cities with the highest rent growth include Miami (+27.5%) and Austin (+24.2%).

In Oct., though, the pace of that rent growth slowed in 95 out of the country’s 100 largest metros. And rent decreased in 22 cities, including San Francisco, Minneapolis, Seattle, Boston, and Washington, D.C.

But, Apartment List points out, rent dropping in 22 cities isn’t that impressive given renting’s seasonality.

“In October 2019, rents declined in 76 of these cities,” the company said.

Apartment List added that some places, such as the San Francisco Bay Area, “may be settling into a new normal in which prices lag pre-pandemic levels for some time to come.” Yet other cities continue to experience rising rent, albeit at slower rates than earlier this year.

In some Sun Belt locations, such as Phoenix and Tampa, rent growth exceeds the national average.

Hard times for most renters

Apartment List attributes much of the rent growth to fewer rental vacancies.

“Our vacancy index spiked from 6.2 percent to 7.1 percent last April, as many Americans moved in with family or friends amid the uncertainty and economic disruption of the pandemic’s onset,” Apartment List said.

But the vacancy rate has trended chiefly down over the past few months. For example, Oct. recorded a 4.1% vacancy rate.

“If our vacancy rate continues to increase in the coming months, it’s likely that rent growth will also continue to cool,” Apartment List said.

Even with cooling rent growth, the company notes that in 2021 rent prices across the country grew faster than before the COVID-19 pandemic. Those increases are putting pressure on renters nationwide.

“Even if rent growth is finally cooling, this year’s rent boom has already added significant housing affordability pressure for America’s renters,” Apartment List said.

What about where you live? Are rents going up or down? Let me know in the comments.

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