As summer winds down and Americans prepare for fall, they can also prepare for more traditional rent prices in some areas of the country.
Brian Carberry, Managing Editor for Rent., said that while rent prices are up in many parts of the country, a few markets are seeing flattened prices or prices are starting to decrease. For example, St. Louis, Cleveland and Baltimore are seeing prices drop for both one- and two-bedroom apartments, according to recent research.
“We are starting to see prices come down in some of the areas that saw major rent price increases at the end of last summer,” Carberry said. “Specifically, areas in the south like Arizona, Texas and Florida. However, each market is going to be different so you will see both increases and decreases in these states.”
Carberry said that supply and demand are contributing to increases and decreases in rent prices.
“When there is high demand and low supply, you’ll see more competition and prices increase. If there is enough supply for the demand in the market, you’ll see prices start to come back down. A lot of the cities that saw major rent price increases during the pandemic were in areas that had more affordable rent prices and attracted people who were fleeing from expensive markets in California and the Northeast. Now that cities have reopened and many people are going back to work on at least a hybrid basis, renters are returning to some of these more pricey cities,” Carberry said.
He added that rent prices are still up in most American cities and fueled by supply and demand.
Carberry offered information about renting trends which could affect Americans.
“There are two big things to look out for over the next few months which could impact rent prices. First, the housing market is beginning to cool. The median sale price is coming down and inventory is staying on the market longer, but due to high interest rates, we haven’t seen a major shift in attitudes from renting to buying. Once those rates start to come down, we could see more demand for homes for sale which will lessen some of the competition for apartments, bringing down the demand and prices,” Carberry said.
The second trend is that during the pandemic prices were “a little wacky,” and now they are getting back to a more traditional seasonal trend.
“Historically, prices increase the most in the summer and are relatively flat in the winter. During the pandemic, prices stayed flat from about March 2020 to August 2021 and then increased by double-digits, but since then have followed a more traditional trend. For instance, while rent prices were up 40 percent in July 2022 compared to July 2021, prices are only up 5 percent and 7 percent for one and two-bedroom apartments, respectively, since the beginning of 2022. As we enter a time where we are comparing to that post-rent price spike, the rate of increase will appear less significant. This is expected to happen in the next month or two.”
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Rebecca Barnabi
