What is the current rent growth rate?

The typical monthly rent saw a 1.8% increase in March, marking the slowest growth rate since December 2020.

Why is rent growth slowing down?

Rent growth is slowing due to an increase in new housing supply, normalizing demand, and affordability constraints affecting landlords' ability to raise prices.

How much income is needed to afford typical rent?

A household needs to earn at least $76,400 annually to comfortably afford the typical monthly rent of $1,910.

Home / Business and Economy / Rent Growth Slows to Multi-Year Low

Rent Growth Slows to Multi-Year Low

23 Apr

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Summary

Rent growth is at its slowest pace since December 2020.
New housing supply and normalizing demand are easing rental costs.
Income rose faster than rents in March, improving affordability.

Rents are experiencing their slowest growth rate since December 2020, according to a recent Zillow study. The typical monthly rent in March saw a modest 1.8% increase compared to the previous year. This deceleration is largely due to new housing supply coming online and demand returning to normal levels, alongside affordability constraints impacting landlords' pricing power.

Further good news for renters is that personal income growth outpaced the rise in rental costs during March. This shift has provided some financial breathing room for households. Specifically, single-family rents saw their slowest annual increase on record since 2015, rising by 2.5%. Multifamily home rents increased by 1.3% to $1,757 per month.