- Nationwide, median asking rents climbed 0.9% year over year to $1,645 – the fifth consecutive month of annualized increases and the largest gain in over a year
- However, it’s been two years since rents reached their all-time high, and they have held relatively steady for the past year
- Rents rose the most year over year in Virginia Beach, Washington, D.C., and Baltimore, and fell the furthest in Austin, San Diego, and Jacksonville – similar trends to last month
What’s happening with rents nationwide?
The median U.S. asking rent rose 0.9% year over year in July to $1,645, just $55 below the $1,700 record high set in August 2022. This is the fifth consecutive increase following 11 months of decreases, and the largest annualized increase since April 2023.
Demand from young renters and difficult homebuying conditions are the primary reasons behind the rising rents. In fact, America’s renter population is growing three-times faster than its homebuyer population, largely because house prices are so high. However, a drop in mortgage rates has helped bring some homebuyers back into the market recently, providing lower overall housing costs. Home sales have yet to rebound, though.
While rents rose the most in nearly 18 months in August, it’s been two years since they hit their all-time high. Since then, rents have remained relatively stable, with only minor changes. Lower rents, paired with wages growing 3.8% year over year, indicate that rental affordability has slightly improved.
Rents are holding steady because multifamily building completions are at historic highs, and some areas now have too much supply. That is prompting some property managers to reduce rents and even offer concessions to prospective tenants.
Rents will likely tick up slightly in the short term, though, in part due to new construction slowing down. However, in the long term, the backlog of apartments will hold rents steady for some time.
Data breakout by bedroom
When looking at all bedroom types combined, rents rose year-over-year. However, when isolating by bedroom type, median asking rents moved more erratically:
- Rents for 0-1-bedroom apartments rose 0.1% YoY to $1,495
- Rents for 2-bedroom apartments was unchanged, remaining at $1,725
- Rents for 3+-bedroom apartments fell 1.7% YoY to $2,008
It may seem odd that rents rose when looking at all bedroom types combined but fell when isolating by bedroom type. This is due to the statistical phenomenon known as Simpson’s paradox.
August 2024: U.S. metros where rents are rising
| U.S. metro area | Year-over-year change in median asking rent | Median asking rent |
| Virginia Beach, VA | +15.2% | $1,635 |
| Washington, D.C. | +12.2% | $2,100 |
| Baltimore, MD | +11.3% | $1,640 |
| Chicago, IL | +10.8% | $1,779 |
| Cincinnati, OH | +9.4% | $1,345 |
| Houston, TX | +9.2% | $1,310 |
| Minneapolis, MN | +8.8% | $1,650 |
| Boston, MA | +4.2% | $2,804 |
| Indianapolis, IN | +3.5% | $1,412 |
| Las Vegas, NV | +3.4% | $1,499 |
Why are rents rising in these metros?
Rent prices are continuing to stay hot in many affordable metros, largely because they haven’t built as many new apartments. So, as people priced out of expensive coastal metros search for affordability, demand starts to outpace supply, which raises prices. The Midwest – generally the most affordable region to live in – has seen months of consistent annualized price growth.
Washington, D.C. is unique because rents aren’t particularly affordable, but they’re still rising because of a surge in demand for lower-priced rentals. In Boston, slowing new construction and consistent demand has helped push prices up over the past year.
August 2024: U.S. metros where rents are falling
| U.S. metro area | Year-over-year change in median asking rent | Median asking rent |
| Austin, TX | -17.6% | $1,482 |
| San Diego, CA | -13.3% | $2,695 |
| Jacksonville, FL | -13.0% | $1,478 |
| San Francisco, CA | -7.8% | $2,668 |
| Tampa, FL | -5.8% | $1,750 |
| Phoenix, AZ | -5.1% | $1,518 |
| Pittsburgh, PA | -4.7% | $1,420 |
| Los Angeles, CA | -4.2% | $2,775 |
| Orlando, FL | -4.1% | $1,762 |
| Nashville, TN | -4.1% | $1,576 |
Why are rents falling in these metros?
One reason rent prices are falling in these metros is because of an abundance of supply. Many popular metros built tons of new apartments in the past few years in an effort to meet demand. Now, some of the most popular pandemic hotspots are seeing newly built apartments go unfilled and construction plummet.
This trend is most obvious in Austin, which saw a massive surge in migration during the pandemic and ramped up construction to accommodate the demand. The metro issued more multifamily building permits (per 10,000 people) than anywhere else from 2021-2023. Now, apartment supply far outweighs demand. Austin has led the nation in year-over-year rent decreases for the past three months, and rents have dropped $317 compared to last year.
Rents may also be falling in these areas because they rose too quickly during the pandemic, causing some residents to get priced out. Now, they’re starting to come back down.
Methodology
According to a Redfin analysis. Asking rent figures in this report cover newly listed units in buildings with five or more units. The median is calculated based on a rolling three-month period. For example, the median asking rent for August 2024 covers rentals that were listed on Rent. and Redfin during the three months ending August 31, 2024.
Metro-level data in this report covers 33 of the 50 most populous U.S. core-based statistical areas (CBSAs). National figures are based on data for the entire U.S.
Asking rents reflect the current costs of new leases. In other words, the amount shown as the median asking rent is not the median of what all renters are paying, but the median asking price of apartments available for rent.
