Redfin reported today (1-12-23) that the median US asking rent rose 4.8% year-over-year to $1,979 in December. This is the smallest increase since July 2021.
Redfin noted that rents grew at more than three times that pace one year earlier (December 2021). December 2022 also marked the seventh straight month in which annual rent growth slowed and the fourth consecutive month in which annual rent growth was held at a single digit, following nearly a year of double-digit increases. Rents fell 1.4% month-over-month and were down 3.6% from their peak in August 2022 of $2,053.
Adding additional background to the press release and her analysis, Redfin’s Economic Research Lead, Dr. Chen Zhao, said:
“Rents have room to fall. While they’ve cooled significantly from their peak, it still costs the typical renter 20% more to take on a new lease than it did two years ago. An increase in the number of rentals on the market should also cause rents to ease in the coming months. Rental supply is growing due to an influx of construction in recent years, ebbing household formation and a slow homebuying market, which is driving many homeowners to rent out their properties rather than sell.”
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