Asking Rents Post Smallest Increase Since December 2021
Rate hikes “dampen consumers’ spending power in the economy as a whole.”
Multiple data sources have reported on the slowdown in apartment rent growth in the past few months, with the latest data point coming from Redfin for August.
It found that median asking rents climbed 11% year-over-year – the smallest hike in a year – to $2,039. On a month-over-month basis, the median asking rent climbed 0.4%, the slowest growth since December 2021 and down from a 1.6% increase a year earlier.
Redfin deputy chief economist Taylor Marr said in prepared remarks that higher interest rates impact the rental market “because they put a damper on spending power in the economy as a whole, including renters’ budgets.
“Growth in rents is also likely to be slowed by a boost in rental supply. There are nearly a million rental units under construction that will hit the market in the coming months and years.”
Cincinnati, Pittsburgh, Indianapolis and Nashville in August led the list of markets where rent grew the most year-over-year.
Cincinnati’s rents were up 26% and Pittsburgh, Indianapolis and Nashville each increased by 20% or more.