Realtor.com® December Rental Report: Rents Continued to Fall as New Construction Outpaced Rental Demand

Core Insights - National rents have declined for the 17th consecutive month, with a year-over-year decrease of -1.1% to a median of $1,695, marking the first time since April 2022 that the median rent fell below$1,700 [1][2] - The rental market is moving towards a more balanced state due to strong supply growth, with the nationwide absorption rate at 55%, aligning with 2019 levels [2][3] - Affordable rentals show stronger demand compared to pricier units, with absorption rates of 56.3% for affordable apartments versus 53.8% for more expensive ones [4] Rental Market Trends - The Northeast region has the highest absorption rates, increasing from 58% to 67% year-over-year, while the West saw a decline from 72% to 58% [5][6] - Year-over-year rent declines were reported in eight out of eleven Western markets, with Denver experiencing a significant drop of -5.9% [6] - Overall inflation has risen by 22.8% since 2019, while rents have only increased by 16%, indicating a lag in rent growth relative to inflation [3] Rental Data Overview - The median rents for different unit sizes are as follows: - Overall: $1,695, -1.1$1,419, -1.3% YoY, +11.3% over 5 years - 1-Bedroom: $1,579, -0.9$1,880, -0.9% YoY, +19.8% over 5 years [7] - Notable year-over-year rent changes in major metropolitan areas include: - Austin, TX: $1,469, -5.0$1,799, -5.9% - Memphis, TN: $1,174, -6.7% [8][9]