Rent growth in the single-family rental (SFR) market continued a slow rebound in March, with rents rising by 3.4% year over year, according to CoreLogic’s latest Single-Family Rent Index (SFRI) report.
March’s rent gain equaled the increase from one month prior. Rents have now spent two months back up above 3.0% after six straight months below that threshold, continuing a gradual but steady to recovery from a period last year and beyond when they decelerated for 18 straight months.
CoreLogic reported the median nationwide monthly rent for a three-bedroom single-family home at $2,052 in February. Among the 20 metros tracked by CoreLogic, large coastal urban hubs led again for rent growth, with Seattle logging the highest year-over-year rent increase at 6.3%, followed by New York at 5.3% and Boston at 5.2%.
Three Southern markets posted annual decreases: Austin (-3.5%), Miami (-3.2%) and New Orleans (-1.4%).
“U.S. single-family rent growth strengthened overall in March, though some weaknesses are revealed in the latest numbers,” said Molly Boesel, CoreLogic’s principal economist. “Overbuilt areas, such as Austin, Texas, continued to soften, decreasing by 3.5% annually in March. … The continued strength in single-family detached rents indicates that potential homebuyers who are priced out of the home-purchase market are choosing to rent similar alternatives.”
All price tiers for single-family rentals saw an uptick in rents, though rent growth at the lowest tiers was vastly weaker than at the same time last year. For example, rents at the least expensive tier of single-family homes, defined by CoreLogic as 75% or less than the regional median, were up 2% on an annual basis in March. In March 2023, they were up 6.3%.
Rents for lower-middle priced properties (75% to 100% of the regional median) were up 3.4% year over year in March, down from 5% in March 2023. Higher-middle priced (100%-125%) property rents were up 3.2%, down from 3.8% in March 2023. Higher priced (125% or more) property rents grew by 2.9%, a slight increase from 2.6% in the same month last year.
Notably, rental prices for single-family attached properties logged a year-over-year decline for the first time in 14 years. Attached single-family rents fell by 0.6% year over year, compared to detached rentals, which picked up by 3.4%.
