Is the rental market cooling off? Here’s how California cities compare to US, new study says
Rent prices are down — a little, depending on where you are.
Data from Realtor.com released this week found rent prices across the United States fell 0.5 percent in May compared to this time last year. That’s the first time we’ve seen a year-over-year drop since the early pandemic days, The Washington Post reported.
Landlords are asking for a median rent of $1,739. That’s down by $38 from last year’s peak. But it’s still $344 higher than it was in 2019.
One economist compared it to a balloon that floated to the ceiling — it’s good that it stopped getting higher, but it can still be hard to grab.
But housing costs are still driving inflation and affordability is a big concern. And the fact that renters are searching for more affordable places to live means that lower-rent markets will have relatively stronger rental demand. That means we could see accelerated growth in those areas.
And the prices depend a lot on where you live.
Realtor.com found prices are cooling faster in western metros than in the Northeast. And Midwest markets are seeing faster growth.
The median rents in the Las Vegas, San Bernardino, Phoenix and Austin metro areas, for instance, dropped between 5 to 6 percent.
But cities like Indianapolis, Cincinnati, St. Louis and Columbus saw increases between 7.3 to 9.30% year over year.
San Jose was the only California metro to see an increase — the median rent went up 1%.
Five other California cities saw the following decreases, according to realtor.com, a real estate listing website:
- Los Angeles metro by 2.6%,
- San Bernardino metro by 5.9%,
- Sacramento metro by 3.5%
- San Diego metro by .6%
- San Francisco metro by 4%
“You are seeing there that new rents in new leases are coming in at low levels,” Federal Reserve Chair Jerome Powell said at a news conference in June. “You are seeing there that new rents in new leases are coming in at low levels.”
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This story was originally published July 5, 2023 at 10:25 AM with the headline "Is the rental market cooling off? Here’s how California cities compare to US, new study says."
