Rent increases at the slowest rate in 18 months.

In spite of inflation, rents are still higher than they were a year ago, but the gains are eroding as landlords lose their ability to set prices.


According to Realtor.com, rents increased 4.7% in October compared to October 2021, the slowest annual growth in 18 months.

The majority of landlords continued to say they would raise rents over the course of the following year, albeit with a smaller increase than in the past.

The sweltering rental market is now beginning to cool off alongside the rest of the housing market.

In spite of inflation, rents are still higher than they were a year ago, but the gains are eroding as landlords lose their ability to set prices.

According to Realtor.com, rents increased 4.7% in October compared to October 2021, the slowest annual growth in 18 months. The median rent in the US was $1,734.

According to Danielle Hale, chief economist at Realtor.com, “our data indicates that we are finally starting to see a bit of relief from the double-digit pace of rent growth that we experienced during the height of the pandemic.” “While it’s still too soon to say that rent prices are officially on a downward trajectory, the data shows a promising return toward normal seasonal slowdowns and suggests that the sky-high price gains of the past several years may be behind us,” says the report.

The majority of landlords said they would continue to raise rents over the next year, albeit by a smaller margin than they have recently, according to a fall survey by Realtor.com, even though more tenants were having trouble paying the rent.

Since October of last year, before the Covid19 pandemic, rents have increased by 23.5%. Two-bedroom apartments saw the biggest increases in rent as tenants sought out more space in the new work-from-home economy.

For the past nine months, rent growth has slowed and for the past three months, it has been in the single digits. However, rents are still increasing more quickly than they did in March 2020, just before the pandemic began.

More renters are considering moving because of affordability, despite the slower gains. In a survey conducted by Realtor.com, 69.5% of respondents whose rents had gone up said they were thinking about moving somewhere less expensive, up from 66.2% in July.

Both multifamily and single-family rentals are covered by the survey. According to other reports, single-family rents are cooling more quickly than apartment rents.

According to CoreLogic, single-family rent growth has been declining for the previous five months but is still in the low double digits. The most recent month for which data is available in September, and rent growth was 10.2% year over year, down from nearly 14% growth in April of this year when interest rates really took off.

According to Molly Boesel, principal economist at CoreLogic, “high mortgage interest rates may be causing potential homebuyers to pause and remain renters, keeping pressure on rent prices.” “However, the monthly rent change was negative in September, returning for the first time since 2019 to the typical seasonal pattern, which may indicate the start of a normalization of rent price growth.”

Rent pressure for multifamily properties is affecting both investors and builders. According to a National Association of Home Builders report, the third quarter of this year saw a sharp decline in developer confidence in the market for multifamily housing. The report keeps tabs on apartment building construction and habitation.

Developers are beginning to notice signs of a slowdown even though the number of multifamily units under construction is at its highest level in almost 50 years and construction spending is still rising.

According to the report, the main causes of this decline in confidence, which has the greatest impact on affordable housing projects, are the high cost of materials and land as well as weakening financing conditions given the Federal Reserve’s recent monetary policy.

Currently, the NAHB anticipates a marked decrease in multifamily construction in 2023.

Realestate