Rents rose for third straight month in March: Redfin

Median rent prices in the U.S. rose for the third straight month in March, rising 0.8% from a year earlier to $1,987, according to the latest survey. report From real estate company Redfin.

Rent prices have been falling across the country for the past three months, but like inflation, rents are starting to rise again.

Redfin pointed to high mortgage rates (due to high borrowing costs set by a committee of Federal Reserve officials) as a factor. More people are putting off buying a home and choosing to rent, increasing the demand for rental units.

Changes in rental prices varied widely by region. Rents in the Midwest soared faster than any other region last month, rising 5.3% from last year to a record $1,456. The second biggest increase was in the Northeast, where he was at $2,504, up 3.8% from last year. Median rents in the South rose only 0.3% year-on-year, while in the West they fell 0.7%.

Redfin said regional rent price fluctuations are uneven because more housing is being built in the South and West, which increases competition among landlords to fill vacancies. I think it means that. Renters in the Midwest and Northeast are competing for fewer vacancies, making it easier for landlords to raise rents.

Redfin says the Midwest remains the best place to live, and national rent prices aren’t rising as fast as during the pandemic.

In 2022, rents increased by 17.7% year-on-year, but fell below 3% in 2023 as more apartments came on the market.

“During the pandemic, we’re seeing property owners charging $2,800 a month in rent for homes that were $2,000 a year ago,” said Heather Mahmoud Khoury, a Redfin real estate agent in Phoenix, Arizona. “I did it,” he said. Many people are trying to rein in their spending, making it harder for property owners to get tenants to agree to large rent increases. ”

Redfin says the number of apartments under construction is also near an all-time high, which is expected to significantly increase housing supply, which will help prevent future interest rates from rising too quickly.