Rent growth is starting to slow. But it’s descending from a tremendous peak.
Consumer price data released Thursday showed rental prices rose 7.2% from September 2021 to September this year, the biggest annual increase since 1982. Overall, the cost of shelter is one of the most important drivers of rising consumer prices, along with food and medical costs, the Labor Department said.
Still, it’s not all bad news for tenants. Median rental prices in the nation’s 50 metropolitan areas rose 7.8% in September, the slowest annual pace in 16 months, according to his Realtor.com new report published Thursday. . This marks the second straight month of single-digit year-over-year growth in zero- and two-bedroom properties, with median asking rents down $12 a month, according to Realtor.com. means
However, housing inflation in the Consumer Price Index has lagged trends in the rental market, so slowing rent growth may not be reflected in the data for some time.
Median rental prices are nearly 23% higher than they were two years ago, but they’re no longer rising at a ferocious rate with no end in sight. These days, economists say it counts as a silver lining.
“After more than a year of double-digit annual rent growth and months of record-high rents, before we see any major shifts like the recent rental market cooldown, the Realtor.com chief said: It’s especially important to see consistency.” Economist Daniel Hale said in his statement: “But September data provides evidence of that, with rents across the country continuing to fall from their latest all-time highs set just two months ago.”
“The return of seasonal norms indicates that the rental market is charting a path back to a more typical balance of supply and demand compared to previous years,” Hale added. “We expect rental growth to continue to slow in the coming months, partly due to the impact of inflation on renters’ budgets.”
However, affordability is getting worse, says Realtor.com. Blame the fact that consumer prices are rising faster than wages.
(Realtor.com is operated by News Corp NWSA.
subsidiary Move Inc., MarketWatch is a division of Dow Jones, which is also a subsidiary of News Corp.).
Redfin RDFN,
In cities such as Oklahoma City (24.1%) and Pittsburgh (20%), rents are still growing significantly year over year. ), Indianapolis (17.9%)
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