Apartment Rent Rates Falling from Record Highs
New York, NY, September 26, 2022-"Apartment rents are falling from record highs across the U.S. for the first time in nearly two years, offering the prospect of relief to millions of tenants who have seen steep increases during the pandemic,” reports the Wall Street Journal.
“August apartment asking rents nationally fell 0.1% from July, according to a report from property data company CoStar Group. It was the first monthly decline in rent since December 2020, the company said.
“Other surveys also showed rent declines of various degrees. Apartment-listing website Rent.com showed a 2.8% decrease in rent for one-bedroom apartments during the same month. A third measure, by the listings website Realtor.com, also noted a slight monthly decline in rent this August.
“Last month’s rent declines are modest compared with the 23% overall increase in rent since August 2020, according to Realtor.com, and there is no guarantee that rents won’t move up again. As more households feel priced out of the sales market because of rising mortgage rates and near-record sales prices, overall demand for rentals is unlikely to fall drastically, said Orphe Divounguy, an economist at Zillow Group.
“Yet many economists say the rental market is likely to see more declines in the coming months. Prices typically dip during the fall and winter. CoStar predicts that by the end of September, rent will have declined for the second straight month.
“Other analysts said they expect rents to decline on a monthly basis or remain flat through at least the end of this year. That would stand in contrast to the same period in 2021, when rents continued to climb.
“Rent growth climbed quickly to records over the past two years, a streak some analysts have attributed to an explosion of pent-up apartment demand caused by early pandemic lockdowns. The boom in home-sale prices, which priced some people out of buying, also boosted rental demand.”