A new report shows that national one-bedroom rents are now 0.7% lower than a year ago, but that’s not true in all markets.
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For the second time in three years, the monthly cost of renting a one-bedroom home is lower than a year ago, according to a new report released Tuesday that suggests an era of unprecedented rent increases is over in much of the country.
National one-bedroom rental prices fell 0.7% in February. Two-bedroom rents rose 0.7%, according to new data Report from Zumper. This increase is lower than typical annual rent increases in the United States.
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The report, which is only the latest, found that rents have fallen the fastest in markets where supply has increased the most, typically in the Sunbelt and West, while rents have continued to rise in markets in the Midwest and Northeast where supply has increased less.
Zumper CEO Anthemos Georgiades said: “The U.S. market has record apartment supply and tenants have more choices, so landlords have more incentive to retain tenants because under current circumstances, apartments are likely to remain vacant for longer.” If renters want to avoid the hassle of moving, or want to wait out the current economic uncertainty, staying put may mean little, if any, rent increases this year.”
While it’s often common for tenants to face rent increases upon renewal, increased supply in many markets means property managers have less leverage to increase rent costs upon renewal, Zumper said.
February was the fifth consecutive month of flat or negative monthly rent changes nationally, according to the Zumper Index.
Rent for a one-bedroom was $1,482 in February, while rent for a two-bedroom was $1,837, Zumper said.
However, not every market is experiencing a slowdown. New York City, Chicago and Cleveland are cities where supply is relatively low compared to demand, but rents are up about 20% from this time last year, Zumper said.
Meanwhile, Austin and Dallas have significantly increased their apartment supply in recent years, but rents are down 10% from this time last year.
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