Rent Rates Fell in March for First Time Since Pandemic
New York, NY, April 17, 2023-"Rental prices are easing after years of soaring during the pandemic,” reports the Wall Street Journal.
“Median rent fell 0.4% to $1,937 in March from a year ago, according to a report released Friday by Redfin Corp. It was the first annual decline since March 2020, when the pandemic began, the real-estate company said. The drop brought rents to their lowest level in 13 months.
“Rents remained 19.9% higher than they were at the pandemic’s beginning three years ago, Redfin said.
“Rents grew over much of the pandemic as a rise in home-sale prices kept some people from buying and drove demand for rentals. In recent months, rents have been falling. Analysts say that is because of an increase in new apartment construction along with weaker consumer sentiment, which may be drawing people away from signing pricey leases.
“Rents peaked in 2022 as wages rose and millennials started families, leading them to seek bigger places, Redfin said. Still-high inflation has people paying more for groceries and many other items, said Daryl Fairweather, Redfin’s chief economist. That has some looking to save on housing, sometimes by getting roommates, she said.
“‘There are fewer people willing to splurge on rentals right now,’ Ms. Fairweather said. ‘If one landlord charges too much, they can go to the next,’ she added.
“Other surveys have shown recent rent declines. Renters with new leases in January paid a median rent that was 3.5% lower than they would have paid last August, according to estimates from listing website Apartment List. It was the first time in five years that rent fell every month over a six-month period, according to the same estimates.
“According to Redfin, the biggest decline was in Austin, Texas, where rents fell 11% in March, to $2,104, from the same month a year ago. In Chicago, they fell more than 9%, to $2,206.
Big cities that saw rent declines of 3% or less included Atlanta, Houston, Las Vegas, New Orleans and Phoenix.
“Rents rose the most in Raleigh, N.C., up nearly 17% to $2,080. In Cleveland, they were up more than 15%, to $1,530.”