Realtor.com® April Rental Report: National Rents Drop Again, But Three Midwest Markets Surge to Record Highs

Rhea-AI Summary

The April Realtor.com® Rental Report reveals a national median rent drop of -0.7% to $1,723, marking the ninth consecutive year-over-year decline. Renters in Austin, Las Vegas, and San Francisco see significant savings, with Austin experiencing the largest decrease at -11.5%. Conversely, Indianapolis, Milwaukee, and Minneapolis hit record-high rents due to low unemployment and slow housing construction. Median rents for studios and one-bedroom units fell by -1.7% and -1.4%, respectively. Despite these declines, rents remain higher than five years ago, indicating a varied rental market landscape.

Positive

• National median rent fell by -0.7% to $1,723, the ninth consecutive year-over-year drop.
• Significant rent savings in Austin (-11.5%), Las Vegas (-11.1%), and San Francisco (-9.9%) compared to peak periods.
• Median rent for studios declined by -1.7%, one-bedroom units by -1.4%, contributing to overall affordability.

Negative

• Three Midwest markets (Indianapolis, Milwaukee, Minneapolis) experience record-high rents driven by low unemployment and new home construction.
• Overall rents are still $33 (-1.9%) below their August 2022 peak, indicating a slow pace of decline.
• Despite declines, the current median rent remains 22.5% higher than five years ago, reflecting long-term affordability challenges.

Insights

Financial Analyst

Financially, the shifts in rental prices have distinct implications for different classes of stakeholders: landlords, renters and real estate investors. With $1,723 as the new median asking rent, representing a modest -0.7% year-over-year decline, the market is signaling a slight cooling, which can be attributed to various macroeconomic factors including inflation and interest rates.

For real estate investors, especially those with portfolios heavily weighted in the historically expensive markets such as Austin, Las Vegas and San Francisco, the declining rents could translate to reduced rental income. While rental prices are dropping from their peaks, they are still significantly higher than pre-pandemic levels by 21.1% in Austin over five years, reflecting enduring market strength despite recent adjustments.

On the other hand, markets such as Indianapolis, Milwaukee and Minneapolis are experiencing record high rents attributed to below-average unemployment and slow home construction. These regions provide opportunities for investors seeking stable income, although they might face increasing affordability challenges for renters.

Short-term, the downward pressure on rents in some key markets could benefit renters. However, the long-term outlook remains mixed as different markets adjust at varied paces. Investors must stay vigilant about regional trends and economic indicators that influence rental income and property values.

Market Research Analyst

From a market research perspective, the divergent rental trends across the U.S. highlight the importance of localized analysis: the rental market is not homogenous and local economic conditions heavily influence rent prices.

Markets with significant declines like Austin, Las Vegas and San Francisco are likely experiencing these trends due to a combination of new housing supply, demographic shifts and perhaps remote work trends allowing people to relocate to more affordable areas. For example, Austin's influx of multi-family homes has increased vacancy rates, putting downward pressure on rents.

Conversely, the Midwest markets hitting record highs reflect a different scenario: low unemployment and slow new home construction are the key drivers. These factors create tighter rental markets, pushing prices up. As such, renters in these regions may face higher costs, exacerbating affordability issues.

Understanding these nuances is critical for investors and stakeholders to make informed decisions based on regional economic drivers and housing supply dynamics.

Median rents fell -0.7% in April with renters in pricey Austin, Las Vegas, and San Francisco enjoying the biggest savings, meanwhile rents in Indianapolis, Milwaukee, and Minneapolis reach a high

SANTA CLARA, Calif., May 22, 2024 /PRNewswire/ -- Rents fell again last month, with particularly big savings for renters in Austin, Texas; Las Vegas; and San Francisco compared to when those markets peaked, according to the Realtor.com^® Rental Report released today. Still, some areas with low unemployment and a slower pace of new home construction saw record-high rents that could continue to rise into the summer months.

The median asking rent nationally for 0-2 bedroom units fell by -0.7% from April of last year, to $1,723, and declined across all size categories. It was the ninth straight year-over-year drop, though the pace of rent declines has slowed. Rents are just $33 (-1.9%) below their August 2022 peak.

"In the ever-fluctuating real estate market, renters will find that trends vary significantly by location," said Danielle Hale, Chief Economist at Realtor.com^®. "Renters in some historically expensive areas are seeing lower prices compared to what they would have paid at the peak of the market, while many relatively affordable markets are witnessing a continued rise in rental costs to new highs, and the scales could tip to even more markets later this summer."

Renters in some South and West markets see biggest savings; Austin leads the way
The median asking rent for Austin, Texas in April was $1,494, which is down $195 (-11.5%) from its September 2022 peak. That's the largest percent savings, compared to the market's peak, among the 50 biggest metro markets. The decline was partly driven by an influx of new multi-family homes into the Southern market, which has helped to push Austin's rental vacancy rate higher. Rents in Austin have been declining month-over-month since June 2023. Still, April's median asking rent in Austin is $260 (21.1%) more than it was five years ago, before the pandemic. The metro with the second-biggest rent savings since the peak was Las Vegas, where renters could save $184 on average by renting a typical property today, down -11.1% from the June 2022 high. And in San Francisco, a typical renter could save $303 per month, down -9.9% from the July 2022 peak.

Three Midwest metros hit record-high rents and more could follow
By contrast, in parts of the Midwest, rents are climbing. The median asking rents hit their highest levels since March 2019 in three Midwest cities: Indianapolis (up 4.5% annually to $1,334), Milwaukee (up 3.8% to $1,671), and Minneapolis (up 2.5% to $1,529). Driving higher rents are below-average unemployment rates and the slow pace of new multi-home construction. Current rental prices in Cincinnati, Cleveland and Chicago are all slightly below peak but could hit their own record highs this summer if the recent growth trend continues. While rents in many Midwest metro areas are generally more affordable than in cities in other parts of the country, in some key markets renters are facing increasing affordability challenges.

Rents decline across all size categories
On average, rents for units of all sizes continued their months-long trend downward in April. Studios saw the biggest drop, with the median asking rent nationwide falling by 1.7% on a year-over-year basis, to $1,443. That's down -3.2% from its October 2022 peak but 18.9% higher than five years ago. Median rent for one-bedroom units fell -1.4% to $1,601, the eleventh straight month of annual declines. And the median rent for two-bedroom units fell by -0.7% to $1,916. That's -1.9% lower than its August 2022 peak but 24.4% more than five years ago.

National Rental Data – April 2024

Unit Size	Median Rent	Rent YoY	Rent Change – 5 years
Overall	$1,723	-0.7 %	22.5 %
Studio	$1,443	-1.7 %	18.9 %
1-bed	$1,601	-1.4 %	20.9 %
2-bed	$1,916	-0.7 %	24.4 %

Rental Data – 50 Largest Metropolitan Areas – April 2024

Metro	Median Rent (0-2 Bedrooms)	YoY (0-2 Bedrooms)	Peak Rent since Mar. 2019
Atlanta-Sandy Springs-Alpharetta, GA	$1,611	-5.6 %	$1,767
Austin-Round Rock, TX	$1,494	-8.3 %	$1,689
Baltimore-Columbia-Towson, MD	$1,762	-5.6 %	$1,872
Birmingham-Hoover, AL	$1,299	1.5 %	$1,333
Boston-Cambridge-Newton, MA-NH	$2,926	-1.7 %	$3,056
Buffalo-Cheektowaga, NY	NA	NA	NA
Charlotte-Concord-Gastonia, NC-SC	$1,513	-5.6 %	$1,670
Chicago-Naperville-Elgin, IL-IN-WI	$1,834	1.4 %	$1,860
Cincinnati, OH-KY-IN	$1,354	1.0 %	$1,362
Cleveland-Elyria, OH	$1,210	2.1 %	$1,226
Columbus, OH	$1,182	-1.1 %	$1,222
Dallas-Fort Worth-Arlington, TX	$1,491	-2.8 %	$1,599
Denver-Aurora-Lakewood, CO	$1,910	-0.8 %	$1,987
Detroit-Warren-Dearborn, MI	$1,290	0.6 %	$1,352
Hartford-West Hartford-East Hartford, CT	NA	NA	NA
Houston-The Woodlands-Sugar Land, TX	$1,385	-2.7 %	$1,434
Indianapolis-Carmel-Anderson, IN	$1,334	4.5 %	$1,334
Jacksonville, FL	$1,539	-3.0 %	$1,658
Kansas City, MO-KS	$1,288	-2.3 %	$1,352
Las Vegas-Henderson-Paradise, NV	$1,481	-4.0 %	$1,665
Los Angeles-Long Beach-Anaheim, CA	$2,766	-2.2 %	$2,898
Louisville/Jefferson County, KY-IN	$1,219	-3.5 %	$1,280
Memphis, TN-MS-AR	$1,222	-4.9 %	$1,316
Miami-Fort Lauderdale-West Palm Beach, FL	$2,382	-4.3 %	$2,539
Milwaukee-Waukesha, WI	$1,671	3.8 %	$1,671
Minneapolis-St. Paul-Bloomington, MN-WI	$1,529	2.5 %	$1,529
Nashville-Davidson–Murfreesboro–Franklin, TN	$1,523	-8.4 %	$1,681
New Orleans-Metairie, LA	NA	NA	NA
New York-Newark-Jersey City, NY-NJ-PA	$2,876	4.1 %	$2,920
Oklahoma City, OK	$1,006	0.5 %	$1,023
Orlando-Kissimmee-Sanford, FL	$1,677	-5.9 %	$1,810
Philadelphia-Camden-Wilmington, PA-NJ-DE-MD	$1,813	1.5 %	$1,832
Phoenix-Mesa-Scottsdale, AZ	$1,540	-4.6 %	$1,684
Pittsburgh, PA	$1,474	1.6 %	$1,475
Portland-Vancouver-Hillsboro, OR-WA	$1,721	2.5 %	$1,760
Providence-Warwick, RI-MA	NA	NA	NA
Raleigh, NC	$1,487	-5.3 %	$1,640
Richmond, VA	$1,477	-3.0 %	$1,556
Riverside-San Bernardino-Ontario, CA	$2,156	-0.8 %	$2,233
Rochester, NY	NA	NA	NA
Sacramento-Roseville-Folsom, CA	$1,953	3.0 %	$1,968
San Antonio-New Braunfels, TX	$1,230	-8.1 %	$1,353
San Diego-Chula Vista-Carlsbad, CA	$2,888	-0.3 %	$3,145
San Francisco-Oakland-Berkeley, CA	$2,766	-4.3 %	$3,069
San Jose-Sunnyvale-Santa Clara, CA	$3,318	3.7 %	$3,344
Seattle-Tacoma-Bellevue, WA	$2,017	-0.3 %	$2,132
St. Louis, MO-IL	$1,318	-1.6 %	$1,373
Tampa-St. Petersburg-Clearwater, FL	$1,741	-2.5 %	$1,828
Virginia Beach-Norfolk-Newport News, VA-NC	$1,518	2.4 %	$1,551
Washington-Arlington-Alexandria,DC-VA-MD-WV	$2,225	1.3 %	$2,263

Methodology 
Rental data as of April 2024 for studio, 1-bedroom, or 2-bedroom units advertised as for-rent on Realtor.com^®. Rental units include apartments as well as private rentals (condos, townhomes, single-family homes). We use rental sources that reliably report data each month within the top 50 largest metropolitan areas. Realtor.com^® began publishing regular monthly rental trends reports in October 2020 with data history stretching back to March 2019.

About Realtor.com^®
Realtor.com^® is an open real estate marketplace built for everyone. Realtor.com^® pioneered the world of digital real estate more than 25 years ago. Today, through its website and mobile apps, Realtor.com^® is a trusted guide for consumers, empowering more people to find their way home by breaking down barriers, helping them make the right connections, and creating confidence through expert insights and guidance. For professionals, Realtor.com^® is a trusted partner for business growth, offering consumer connections and branding solutions that help them succeed in today's on-demand world. Realtor.com^® is operated by News Corp [Nasdaq: NWS, NWSA] [ASX: NWS, NWSLV] subsidiary Move, Inc. For more information, visit Realtor.com^®.

Media contact:
Sara Wiskerchen, press@realtor.com

View original content:https://www.prnewswire.com/news-releases/realtorcom-april-rental-report-national-rents-drop-again-but-three-midwest-markets-surge-to-record-highs-302152180.html

SOURCE Realtor.com

FAQ

What was the national median rent in April 2024?

The national median rent was $1,723 in April 2024.

Which cities saw the largest rent declines in April 2024?

Austin, Las Vegas, and San Francisco experienced the largest rent declines.

By how much did rents decline in Austin in April 2024?

Rents in Austin declined by -11.5% compared to their September 2022 peak.

Which Midwest markets recorded high rents in April 2024?

Indianapolis, Milwaukee, and Minneapolis recorded high rents in April 2024.

What factors contributed to high rents in Midwest markets like Indianapolis, Milwaukee, and Minneapolis?

Low unemployment rates and a slow pace of new home construction contributed to high rents in these markets.

How did studio apartment rents change in April 2024?

Studio apartment rents fell by -1.7% in April 2024.

What is the trend in one-bedroom unit rents as of April 2024?

One-bedroom unit rents declined by -1.4% in April 2024.

How much higher are current rents compared to five years ago?

Current rents are 22.5% higher than five years ago.