US Median Rents Rise 2.4% in January, the Slowest Pace Since May 2021

Redfin reported on Friday (2-10-23) that the US median asking rent rose 2.4% year-over-year to $1,942 in January. This marks the smallest increase since May 2021 and the lowest level in nearly a year.

Framing the data another way, the 2.4% increase in roughly one-sixth the pace of January 2022, when rents were up 15.6% from the year earlier. January marks the eighth consecutive month in which annual rent growth slowed. Month-over-month, rents fell 1.9% in January and were down 5.4% from their August 2022 peak of $2,053.

Adding additional background to the report and her analysis, Redfin’s Chief Economist Dr. Daryl Fairweather said:

“We’re watching closely to see whether rents start falling year-over-year. That would be a welcome relief for renters because it hasn’t happened since the onset of the pandemic. If rents do start falling on a year-over-year basis, it will mean that renters have more room to negotiate. It may also prompt more landlords to sell their properties because they’re no longer getting a good return on their investment.

The nationwide rental vacancy rate stopped falling at the end of 2022 and is expected to grow in the coming months as more rentals hit the market, an indicator that rental prices may continue to grow slowly.”