The median asking rent declined year-over-year across all bedroom counts in July, according to new data from Redfin (NASDAQ:RDFN). This marks the first occurrence for across-the-board rent declines since June 2020.
Median asking rents for 0- to 1-bedroom apartments fell 0.1% (to $1,498 a month), 2-bedroom apartments fell 0.3% (to $1,730) and 3-plus bedroom apartments fell 2.4% (to $2,010). All three categories are down at least $50 from all-time highs posted in the last two years.
The overall rental vacancy rate has remained at 6.6% for four consecutive quarters, the highest level since 2021, while the vacancy rate for buildings with five or more apartments – the focus of Redfin’s report – was at 7.8% in the second quarter, up from 7.4% a year earlier.
Redfin also noted the median asking rent for all bedroom counts combined inched up 0.4% year-over-year in July to $1,647, which was explained as discrepancy between the combined result (showing a gain) and the three different bedroom types (which all fell) – a statistical phenomenon known as Simpson’s paradox.
On a month-over-month measurement, July’s national median asking rent was down 0.2% from June – it was also $53 less than the all-time high of $1,700 recorded in August 2022. Sun Belt states, particularly Florida and Texas, saw the largest decline in rent prices while East Coast and Midwest cities saw the biggest increases.
“Rents have recently steadied – or even dropped slightly – because of the sheer number of apartments built over the past two years,” said Redfin Senior Economist Sheharyar Bokhari. “Construction is slowing down and prices will eventually start rising again, but now is still a good time for renters to find a deal, especially families looking for an apartment with at least three bedrooms.”
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