The rental market has cooled in recent months, leading many property managers to offer concessions—such as free rent or parking—to attract tenants. Despite these perks, rents continue to rise, though at a slower pace. According to a recent report from real estate market platform Zillow, for both single-family and multifamily rentals, rents increased by 0.4% on a month-over-month basis.
However, the single-family rental market continues to see slightly more growth overall when compared with the multifamily market. Since the pandemic began, single-family rents have surged by 40.1%. Year-over-year, single-family rents have increased by 4.7%. Multifamily rents, which typically sit lower ($1,916 as of July), have increased by 2.6% over the past year and 27.3% since the pandemic started. In general, multifamily rent growth is more moderate compared to single-family homes, with some metro areas even seeing slight monthly declines.
The question as we look ahead is whether the current status quo of slow rent growth and elevated concessions will continue, or whether rents will actually come down. The recent mortgage rate dip could soften rental demand as more households can afford to buy a home. A labor market slowdown could also contribute to falling rents.
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