Rental housing prices across the U.S. were mostly higher last month, although California recorded its first year-over-year rent price declines in two years.
According to the Realtor.com March Rental Report, 4 major metro markets saw year-over-year price declines, including San Francisco (-0.8%), Los Angeles, Riverside-San Bernardino (-5.3%) and Sacramento (-2.1%). These were attributed to tech layoffs and a weakening job market in the state.
But California bucked the national trend – the U.S. rental market experienced single-digit growth for the eighth month in a row after 14 months of slowing from its high of 16.4% growth in January 2022. Realtor.com reported the median rent in the 50 largest metros increased to $1,732, up by $15 from last month. And while the median rent was down $32 from last year’s peak, it was also $354 (25.7%) higher than the same time in 2019 before the pandemic.
The greatest rent hikes were in Indianapolis (10.3%), Cincinnati (9.6%) and Milwaukee (7.8%).
“Mirroring trends that we’ve seen in the for-sale market, affordability is shaping housing demand, with lower-cost areas continuing to see stronger rent growth, home price increases, and competitive real estate markets. Markets in the Midwest and Northeast are benefiting from this trend while cities in the West are adjusting in the opposite direction,” said Realtor.com Chief Economist Danielle Hale. “The good news for renters is that overall rent prices and price growth have both cooled from their highs in early 2022, offering some relief for cost-burdened consumers who are facing higher prices across the board.”