Renting is having a moment

For about five years, renters couldn't catch a break. Rents climbed faster than wages, apartment hunters found themselves in bidding wars over ordinary units, vacancies sat near record lows and the concessions that sweetened a lease all but disappeared as landlords held the upper hand. At the height of the 2022 frenzy, apartment rents were rising nearly 16% a year. For many years now, rents have continued to rise. But this spring, the pendulum has finally swung in renters' favor.

In May, 74% of rental listings on Zillow were affordable to a household earning the median income of about $78,000. Though the typical rental price climbed a bit to $1,951, up just 2% from a year ago, that increase has been offset by a nearly 2% increase in the average income. A median household now spends about 26.9% of its income on a rental property, under the 30% threshold traditionally used as the barometer for affordable housing. Also encouraging is that the share of listings under $1,000 a month rose to 8.8%, a sign that more affordable units are reaching the market.

More supply on the market means more choices, and more choices mean landlords have to compete on price and incentives. The combination of cooling rents and rising incomes has quietly moved the affordability needle in a meaningful way.

Kara Ng
Zillow senior economist

Where rents are most (and least) affordable

The relief is concentrated where new construction has boomed. Among multifamily listings, 79.3% were affordable to a median-income household in May, up from 75.5% a year earlier. Single-family rentals — hotter because buyers priced out of homeownership keep renting houses — lagged at 47.1%, up from 44.6%. The split makes sense: the country finished roughly 592,000 new apartments in 2024, the most since 1974, and all those units landing at once pushed up vacancies and forced landlords to compete. Nearly 40% of listings offered a concession in May, up from 35.1% a year ago. 

Raleigh had the highest share of affordable listings at 94.8%. That market is followed by Austin (91%), Louisville (90.5%), Salt Lake City (90.2%) and Portland (89.3%). The fastest gains came in Florida, where Tampa jumped to 61.4% from 51.6% and Orlando to 69.5% from 61.3%. For the cheapest rents outright, Oklahoma City led with nearly 30% of listings under $1,000.

But not everywhere in the country is a renters’ market. The affordable share slipped in seven metros, with Pittsburgh down hardest, to 77.6% from 80.3%. San Francisco is the clearest outlier: rents are up 7.1% annually, the fastest of any major market, a reminder that the supply story never fully reached the coastal cities where building is hardest.

The catch

The wave renters are enjoying was set in motion years ago, when borrowing costs were low, and developers were more willing to finance new construction projects. New apartment construction peaked in 2022 and has fallen sharply since, as higher financing costs, softer rents and rising vacancies have made many new projects less financially attractive. 

Because new buildings typically take a few years to complete, the apartments arriving today are the tail end of the old boom, not the start of a new one. As that pipeline empties, the supply cushion holding rents down shrinks. Zillow expects multifamily rent growth to increase 2% in 2026, as construction fades and a persistent housing shortage reasserts itself.

"The construction boom that drove affordability gains has slowed," Ng said, "and rent growth may reaccelerate in the near future." Renters shopping this spring may be doing so at something close to the bottom of the cost curve.

The question, of course, is when might this favorable rental market end.

“Right now, many renters hold the upper hand,” said Ng. “That won’t always be the case, so renters who can negotiate a sweeter deal, should.”

Methodology note: Figures are drawn from the Zillow May Rental Report and the Zillow Observed Rent Index (ZORI). Affordability is defined as a rental costing a median-income household no more than 30% of income. Zillow's listing-level affordability data dates to 2021.