Asking Rent Tops $2,000 Amid Steady Seasonal Growth (March Rent Report)
As the rental season begins to unfold, the typical asking rent in the U.S. has reached $2,005. The median household now allocates 29.4% of its income to rent, nearing the recommended 30% threshold for housing costs. This figure underscores the persistent affordability challenges faced by renters. The income needed to comfortably afford a typical rental has risen to $80,204 — a 35% increase since before the pandemic.
Looming graduation and the milder weather of Spring traditionally bring the biggest upward pressure on rents during the year. This March is no different, with a 0.6% increase from last month and 3.5% increase compared to last year. Even as U.S. home price growth slows to a crawl under increased economic uncertainty, rental market demand persists.
As renters actively pursue smaller, more affordable options and the pace of new apartment development slows, competition for multifamily rentals is rising. Meanwhile, limited options and high costs in the for-sale market are causing potential home buyers to delay their purchases, leading many to seek single-family rentals as an alternative. While annual single-family rent growth is still higher than for multifamily — 4.1% versus 2.9% — those growth rates may move closer together if rising economic concerns lead many renters to prioritize the greater affordability apartment living can offer.
The typical asking rent for single-family homes has grown by 0.6% from last month, now at $2,223, while multifamily homes have seen a slightly higher 0.7% increase, reaching $1,849 for the typical unit.
Nationwide, single-family rentals are moving further out of reach for the median U.S. household. A household making the median income would spend 32.6% of its income on the typical single-family rental. In contrast, multifamily affordability has improved, with renters now typically dedicating 27.1% of their income to housing expenses.
As anticipated, rent concessions are beginning to slip, falling for the first time during March since 2022, before apartment completions began breaking records. Only a small drop, 39.8% of landlords are still offering short-term relief. As competition in the rental market intensifies, particularly over more affordable apartments, landlords are likely to cut back further on these incentives. This may be the last year with prevalent “freebies” during the busy season. With a large chunk of rentals still making offerings, it is important to take advantage of the savings while they last.
Rents
- The typical asking rent is $2,005 in March, up 0.6% month-over-month. The pre-pandemic average month-over-month change for this time of year is 0.7%.
- Since the beginning of the pandemic, rents have increased by 34.7%.
- Rents are now 3.5% up from last year.
- Rents fell, on a monthly basis, in Buffalo (-0.2%). The smallest monthly gains are in Louisville (.04%), Philadelphia (0.1%), Miami (0.2%), and Milwaukee (0.2%).
- Rents are up from year-ago levels in 47 of the 50 largest metro areas. Annual rent increases are highest in Hartford (6.8%), Cleveland (6.7%), Providence (5.9%), Chicago (5.8%), and Columbus (5.8%).
Single-Family Rents
- The typical asking rent for single-family homes is $2,223 in March, up 0.6% month-over-month. Since the beginning of the pandemic, single-family rents have increased by 42.3%.
- Single-family rents are now up 4.1% from last year.
- Single-family rents fell, on a monthly basis, in 3 major metro areas. The largest monthly drops in single-family rents are in Hartford (-0.4%), Buffalo (-0.3%), and Philadelphia (-0.2%).The smallest monthly gains are in Riverside (0%) and New York (0.1%).
- Single-family rents are up from year-ago levels in 49 of the 50 largest metro areas. Annual single-family rent increases are highest in Cleveland (7.4%), Chicago (7.1%), Los Angeles (7.1%), Indianapolis (6.4%), and Providence (6.2%).
Multifamily Rents
- The typical asking rent for multifamily homes is $1,849 in March, up 0.7% month-over-month. Since the beginning of the pandemic, multifamily rents have increased by 28%.
- Multifamily rents are now up 2.9% from last year.
- Multifamily rents fell, on a monthly basis, in 2 major metro areas. The largest monthly drops in multifamily rents are in Louisville (-0.1%), Buffalo (-0.1%). The smallest monthly gains are in St. Louis (0%), Milwaukee (0.1%), and Austin (0.2%).
- Multifamily rents are up from year-ago levels in 45 of the 50 largest metro areas. Annual multifamily rent increases are highest in Hartford (7.1%), Providence (6.2%), Columbus (5.8%), Cleveland (5.8%), and Chicago (5.5%).
Rent Concessions
- 39.8% of rentals on Zillow offered concessions in March.
- The share of rental listings offering concessions decreased by 1.3ppts month-over-month in March.
- The share of rental listings offering concessions increased by 6.8ppts from last year.
- The share of rentals with concessions is lower, on a monthly basis, in 36 major metro areas. The largest monthly drops in the share of rentals with concessions are in Richmond (-7ppts), Virginia Beach (-5.2ppts), Kansas City (-3.6ppts), Phoenix (-3.4ppts), and Milwaukee (-3.3ppts).
- The share of rentals with concessions is higher, on a monthly basis, in 13 major metro areas. The largest monthly increases in the share of rentals with concessions are in Birmingham (4.6ppts), Buffalo (3ppts), Detroit (2.8ppts), Cincinnati (2.6ppts), and Jacksonville (2.2ppts).
- Rent concessions are up from year-ago levels in 46 of the 50 largest metro areas. The annual increase in share of rental listings with concessions is highest in Denver (17ppts), Milwaukee (15.7ppts), Indianapolis (15.6ppts), Houston (14.6ppts), and Memphis (14ppts).
Rent Affordability
- The median household would spend 29.4% of their income on a new rental in March.
- Rent affordability stayed flat month-over-month in March. The pre-pandemic share of median household income spent on rent was 27.2%.
- The most affordable metro areas for rents are Austin (19.5%), Minneapolis (19.8%), Salt Lake City (20.2%), St. Louis (20.4%), and Raleigh (20.4%).
- The least affordable metro areas for rents are Miami (40.0%), New York (39.1%), Los Angeles (36.8%), San Diego (33.1%), and Tampa (33.1%).
- Income needed to afford rent increased by 3.4% year-over-year in March to $80,204. Since pre-pandemic, the income needed to afford rent has increased by 34.6%.