US Rents Post First Year-Over-Year Decline Since March 2020

Redfin reported on Friday (4-14-23) that the median US asking rent fell 0.4% year-over-year in March to $1,937. This is the first annual decline in asking rents since March 2020 and the lowest median asking rent in 13 months. As a comparison, rents were up 17.5% one year earlier in March 2022.

Redfin is reporting that the median asking rent in March was unchanged from February. However, it remains $322 higher (19.9%) than it was at the onset of the COVID-19 pandemic three years earlier. It is important to note, Redfin says, that wages increased at roughly the same pace during the time period.

Rents declined year-over-year in March largely due to a surplus of supply resulting from the pandemic homebuilding boom, according to Redfin. The number of multifamily units that went under construction and the number completed each rose to the second highest level in more than three decades in February, the latest month for which data is available.

Redfin concludes that the overall rental market is also cooling because still-high rental costs, inflation, rising unemployment, and recession fears are causing rental demand to ease. Rental vacancies are on the rise, prompting some landlords to cut rents and/or offer concessions like discounted parking.