Apartment rent trends continue to defy seasonal norms, with month-over-month growth stalling during the peak moving season, when it is typically at its highest. The national median rent in July was flat at $1,402 after peaking earlier this year, and year-over-year prices are down 0.8%, according to Apartment List’s August national rent report.
“The late spring and summer months are normally the peak season for moving activity, and rent growth tends to ramp up at this time of year in tandem with demand,” said the report. “The fact that we’ve instead seen rent growth get increasingly sluggish indicates softness in the market, possibly reflecting declining consumer confidence amid a more uncertain macroeconomic outlook.”
Year-over-year rent growth was nearly positive for the first time since 2023 in April, but it has now ticked further negative for three consecutive months, according to Apartment List. The Austin metro area is the nation’s softest rental market, with median rent down 6.8% over the past year. The market is notable for permitting new homes at the fastest pace of any large metro in the country, highlighting the impact of new supply on softening rents. Other markets with high permitting levels are also experiencing this trend, including Denver, Phoenix, San Antonio, Salt Lake City, Raleigh and Dallas.
San Francisco has seen the fastest year-over-year rent growth at 4.6%, with much of its gains happening in the urban core. The city saw a 10.6% rise in the category over the past year. Nearby San Jose also cracked the top ten for metro-level rent growth, and the remainder of the top 10 on the list primarily includes markets across the Midwest, such as Chicago, Minneapolis, and Northeast markets, including Providence, Rhode Island and Hartford, Connecticut.
Thirty-seven of the nation's 54 largest metro areas saw rents increase month-over-month in July, but only 26 of these are currently logging positive year-over-year growth. Year-over-year declines are concentrated in the Sun Belt and Mountain West regions, said the report. The cool down comes following a period of record-setting growth. Typical rent prices remain 22% higher than their January 2021 level, according to Apartment List.
Meanwhile, national multifamily vacancy edged up to 7.1% in July, a new record high for the Apartment List index. The firm noted that a surge of multifamily construction has peaked, but the market is still absorbing new units.
Apartments take about 28 days to lease after listing, one day longer than in May but down from a high of 37 days in January. The shortening list-to-lease time is in line with seasonal trends, but units are sitting a bit longer than they typically do at this time of year, signaling market softness in line with rent growth and vacancy trends, said the report.
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