U.S. single-family rental properties posted rent-price growth of 2% during the year ending in September 2024, according to a recent CoreLogic report. That’s down from annual growth of 2.4% in August.
The property data and solutions company reported that the year-over-year gain was well below the pre-pandemic single-family rental (SFR) growth rate of 3.5%. Detached rentals — or standalone properties — saw rent growth decline to 2%. This marked two straight months of declining price growth for detached rentals after annualized increases of 2.6% in July and 2.3% in August.
“Single-family annual rent growth slowed in September to the lowest rate in over four years, and monthly rent growth posted a second month of below-seasonal trend growth, making it clear that single-family rent growth is decelerating,” Molly Boesel, CoreLogic principal economist, said in a statement.
“While about one-third of metros showed stronger rent growth than in the previous year, more metros showed decreases in rents than in the prior report. While a slowing in rents will be welcome news to renters, increases since 2020 are still at 32%.”
CoreLogic also noted that SFR price depreciation is occurring in a few markets in Texas, California and Florida.
Among the 20 metro areas tracked by CoreLogic, Detroit led the way with the highest annualized SFR growth at 5.2%, followed by Seattle (5%) and New York (4.9%). In August, Seattle led the pack (5.8%), followed by New York (5.5%) and Washington, D.C. (5.5%).
Detroit ($1,764) posted the second-lowest median monthly rental price behind Philadelphia ($1,656). Three of the top-five areas for annual rent-price growth in September (Seattle, New York and Washington, D.C) had median prices of more than $3,000. Chicago (ranked No. 4) had a median rent price of $2,663.
CoreLogic’s monthly SFR index analyzes rent prices across four pricing tiers. Lower-priced rentals are those priced below the regional median. Lower-middle-tier rentals sit between 75% and 100% of the regional median. Higher-middle-tier rentals range from 100% to 125% of the regional median, with higher-priced rentals ranging above 125% of the regional median. CoreLogic surveyed properties in nearly 100 U.S. metros — including 43 that covered all four tiers.
The reported pointed out that price growth for high-end rentals, attributed to luxury properties, outpaced properties priced at the lowest end. This is a sign that some renters are taking advantage of increased economic breathing room, CoreLogic explained.
