Apartment List National Rent Report

Overview

Welcome to the September 2024 Apartment List National Rent Report. Our model captured an average rent decrease of -0.1% in August, and today the nationwide median rent stands at $1,412. This signals the end of the rental market’s annual busy season, as well as the second consecutive summer of modest rent growth, as the market remains sluggish thanks to a windfall of new supply. If historical trends hold, rents will continue to fall on a monthly basis for the remainder of the year.

Since the second half of 2022, the seasonal declines in rent prices that take place during the fall and winter have been steeper than usual and seasonal increases of the spring and summer have been more mild. As a result, apartments are on average slightly cheaper today than they were one year ago. Year-over-year rent growth currently stands at -0.7 percent and has now been in negative territory for over a full year. Despite this, the national median rent is still more than $200 per month higher than it was just a few years ago.

On the supply side of the rental market, our national vacancy index remains slightly elevated, currently standing at 6.7 percent. After a historic tightening in 2021, multifamily occupancy has been slowly but consistently easing for over two years. And with 2024 bringing the most new apartment completions in decades, we expect that there will continue to be an abundance of vacant units on the market in the year ahead.

Zooming in a bit, 59 of the nation’s 100 largest cities saw rents fall in August, in line with the broader national trend. And on a year-over-year basis, rent growth is negative for 52 of these cities. Many of the steepest year-over-year declines remain concentrated in Sun Belt cities that are rapidly expanding their multifamily inventory, such as Austin (-7.5 percent year-over-year), Raleigh (-5.6 percent), and Atlanta (-4.9 percent).

Rents are down 0.1% month-over-month, down 0.7% year-over-year

Rent growth follows a seasonal pattern – prices tend to go up during the spring and summer and dip during the fall and winter. Today we are transitioning between those seasons, as positive rent growth in July gave way to negative rent growth in August. Rent declines should accelerate for the next few months, because fewer households tend to move when school resumes and temperatures cool.

Seasonality has shifted slightly in the past two years. Peak monthly rent growth occurred in March both this year and last, two months earlier than what was typical in pre-pandemic years. And cumulative rent increases during the summer season have been lower than previous years. Meanwhile, seasonal declines have been more pronounced. This reflects the sluggish, supply-rich rental market that has persisted since late-2022.

On a year-over-year basis, national rent growth remains in negative territory at -0.7 percent. Year-over-year rent growth – a simple comparison of prices in one month to prices 12 months earlier – dipped below zero back in June 2023 and has stayed there for fifteen consecutive months. After prices skyrocketed in 2021 and 2022, the pendulum has since swung back as price growth has been kept in check by sluggish demand colliding with a robust supply of new inventory hitting the market. That said, this recent dip does not equate to a reversal of the earlier price hikes: the national median rent is a few percentage points below its August 2022 peak, but still more than 20 percent higher than at the start of 2021.

Rent CPI remains elevated even as interest rate cuts loom

The primary measure of inflation in the United States is the Bureau of Labor Statistics's Consumer Price Index (CPI), which is heavily influenced by changes in housing prices.¹ The Apartment List National Rent Index has proven to be a strong leading indicator of the CPI housing and rent components (collectively referred to as “shelter”), since our index captures price changes in new leases, which are only later reflected in price changes across all leases (what the CPI measures).

Because of these methodological differences, when our index peaked with record-setting rent growth in late 2021, the CPI’s measure of housing cost inflation was still in the early stages of its upswing. And while rent growth as measured by our index was cooling over the course of 2022, the CPI measure continued to rise. But as we had long been predicting, the shelter component of CPI finally turned the corner last spring and has been steadily cooling off ever since – while most components of inflation are difficult to predict, the Apartment List Rent Index can help tell us where shelter CPI is headed. But despite the progress, shelter CPI remains elevated and is continuing to exert upward pressure on topline CPI. As shelter inflation continues to trend down, it will help ease overall inflation as well, but it will take time for shelter CPI to fully metabolize the shock to market rents. That said, it’s widely expected that the Fed will cut interest rates in their September meeting, indicating that they’re not waiting for a full comedown in shelter CPI to shift out of inflation fighting mode.

Apartment vacancies remain near their pandemic peak

The rapid price fluctuations that have defined the rental market over the past three years are largely attributable to changes in the balance between the number of vacant apartments available (supply) and the number of renters looking to move into them (demand). Early in the pandemic, the Apartment List Vacancy Index rose to 6.8 percent as many Americans consolidated households and moved in with family amid large job losses and economic uncertainty. Then, a suddenly tight rental market drove rapid rent growth in 2021 and 2022 as more households competed for a dwindling supply of vacant units. Our vacancy index tightened from 6.8 percent to 3.8 percent in just over a year.

But after bottoming out in October 2021, vacancies have been opening up steadily for over two years. Through August, our vacancy index sits at 6.7 percent, the highest reading since August 2020. And there’s good reason to expect that it could rise even further during the remainder of the year. Despite a recent slowdown in new building permits being issued and new construction projects breaking ground, the number of multifamily units under construction remains near record levels. 2023 saw the most new apartments complete construction in more than 30 years, and an even greater number of new units are expected to come on the market this year. This means that renters should have more available options than they have in some time, especially in the Sun Belt markets where construction activity has been strongest.

Vacancy trends are highly localized, and they have been a key indicator of rapidly evolving conditions in local markets across the U.S. throughout the pandemic. To explore the topic in greater detail, monthly vacancy data are now available for download for hundreds of cities, metros, and states, and can be easily linked to our existing rent estimates using Federal Information Processing System (FIPS) codes.

Rents are down month-over-month in 59 of 100 largest cities, down year-over-year in 52

The chart below visualizes monthly rent changes in each of the nation’s 100 largest cities from January 2019 to present. The color in each cell represents the extent to which prices went up (red) or down (blue) in a given city in a given month. We see a typical seasonal pattern in 2019, followed by 2020, where horizontal bands of dark blue represent steep rent drops in some of the nation’s largest and most expensive cities. Meanwhile, the dark red bands in 2021 and 2022 represent the rent heatwave that drove up prices nationwide. But the right side of the chart shows a strong cooldown in late 2022 and only modest rent growth in the two summers that follow. Nationwide rent growth was negative in August 2024, so too was it negative in the majority of large cities across the country; 59 of the nation’s largest 100 cities saw prices fall month-over-month.

Rents are also down year-over-year for a majority of these cities, a massive deceleration from mid-2022, when all 100 were posting positive annual growth. As the market cooled and many regions experienced back-to-back slow winter seasons, an increasing number of cities saw annual rent change flip negative. Today, the median rent is cheaper than it was one year ago in 52 of the 100 largest cities. Most of these cities are concentrated in Florida, Texas, Arizona, and along the West Coast. In contrast, many large cities in the Midwest and Northeast are still experiencing positive annual rent growth.

New supply driving falling rents in Sun Belt markets while Midwest and Northeast maintain positive growth

The prevalence of year-over-year rent declines in Sun Belt markets can be clearly seen in the metro-level map below. The Austin metro has seen the nation’s sharpest decline among large metros, with prices there down 7.5 percent in the last 12 months. The Austin metro is also significant for permitting new homes at the fastest pace of any large metro in the country, signaling the important role new supply plays in managing long-term affordability. Austin is not alone in exhibiting this trend. Among the ten metros with sharpest year-over-year rent declines, several also rank among the highest in terms of multifamily permitting activity (e.g, Austin, Nashville, Raleigh, Jacksonville, Orlando, Phoenix, San Antonio). Notably all of these markets are located in the Sun Belt.

At the other end of the spectrum, the fastest rent growth has been occurring in metros across the Midwestern and Northeastern United States. These are markets where steady rental demand is not being matched by supply growth. The Midwest is led by Cleveland, Grand Rapids, Milwaukee, and Detroit, while the Northeast is led by Hartford and D.C. Note, however, that even the markets topping the list are mostly experiencing fairly modest rent growth. Only one large metro (Cleveland) has seen rents rise by more than 5 percent over the past year.

Conclusion

With August’s 0.1 percent decrease, the busy season is officially over and rents will continue to fall for the remainder of the year. Year-over-year rent growth also indicates a sluggish market, remaining negative at -0.7 percent. Rent increases are currently being moderated by a robust construction pipeline expected to deliver a decades-high number of new apartment units in 2024. Improving consumer sentiment about broader macroeconomic conditions seems to have driven a rebound in rental demand this year, but that bounceback has so far been outweighed by the impact of incoming supply. And recent signals of labor market softness could dampen demand going forward.

For more detailed data, see the table below, which contains the most recent estimates for the nation’s 100 largest cities. And for complete data, see our rental data download page, where you can download the full history of our monthly estimates going back to 2017 at various geographic levels (national, state, metro, county, and city). And as always, feel free to contact us with any questions.

A Note on Our Methodology

Apartment List has long been committed to making our data products as accurate and transparent as possible. Our rent estimates and vacancy index are calculated as follows:

Rent Estimates: We estimate rent growth using a same-unit approach that controls for compositional changes in the rental stock. We also control for price fluctuations that arise over the course of a vacancy by identifying the last available list price before a unit gets rented as a proxy for its transacted price. Finally, we combat luxury bias in our rent data by benchmarking our reported rent levels to fully-representative median rent statistics from the Census Bureau’s American Community Survey.

Vacancy Index: Our real-time availability data allows us to calculate a daily vacancy rate for each of our partner properties, which we then average over the course of each month to calculate a monthly rate. Our overall index is an average of these property-level vacancy rates, weighted by the number of units in each property. We restrict our sample to properties that have been on Apartment List for at least six months and that have attained a stabilized vacancy rate of 15% or less.

For those interested in getting deeper in the weeds, please see our rent estimate methodology and vacancy index methodology. And if you have any questions or custom data requests, you can reach us at research@apartmentlist.com.

For more context on local data, check out our market-specific rent reports for the following cities:

• Atlanta, GA
• Austin, TX
• Baltimore, MD
• Boston, MA
• Boulder, CO
• Charlotte, NC
• Chicago, IL
• Cleveland, OH
• Colorado Springs, CO
• Dallas, TX
• Denver, CO
• Detroit, MI
• Fort Collins, CO
• Fort Lauderdale, FL
• Houston, TX
• Indianapolis, IN
• Jacksonville, FL
• Los Angeles, CA
• Miami, FL
• Minneapolis, MN
• Nashville, TN
• New Orleans, LA
• New York, NY
• Orlando, FL
• Phoenix, AZ
• Philadelphia, PA
• Raleigh, NC
• San Antonio, TX
• San Diego, CA
• San Francisco, CA
• San Jose, CA
• Seattle, WA
• Tallahassee, FL
• Tampa, FL
• Tucson, AZ
• Washington, DC

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About Apartment List Rent Reports:

Apartment List’s Rent Reports cover rental pricing data in major cities, their suburbs, and their neighborhoods. We provide valuable leading indicators of rental price trends, highlight data on top cities, and identify the key facts renters should know. As always, our goal is to provide price transparency to America’s 105 million renters to help them make the best possible decisions in choosing a place to call home. Apartment List publishes Rent Reports during the first calendar week of each month.