Rent for a typical single-family rental property increased +8.5% in July after rent prices jumped in June to their highest level since 2005.
Rent Prices for Single-Family Properties on Skyrocketing Tear
The just released CoreLogic Single-Family Rent Index report tells us that rent prices for an average single-family home jumped another +8.5% y/y in July after June’s increase of +7.5%.
This +8.5% increase, up from 1.7% since July 2020, represents a fivefold increase in rent prices for the second consecutive month. This +8.5% increase also represents a 16.5-year rent price high.
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How could such lightening growth in single-family rental prices be happening? The quick (and accurate) answer is two-fold: a shortage in inventory and the over-the-moon home values that go along with single-family inventory shortages over these last five years.
According to Molly Boesel, principal economist with CoreLogic, “Single-family rent prices continue to climb as national economic recovery, the overcrowded purchase market and deficient inventory puts pressure on the rental market. With eviction moratoriums coming to a close this fall, and single-family rental inflation showing no signs of slowing over the next several months, affordability challenges may begin to pose a more urgent concern for renters.”
Single-Family Rent Changes for Some Metros
As you will note in this chart, single-family home rental growth is running well above pre-pandemic levels compared those levels in 2019.
Phoenix again stands out with the highest year-over-year rent growth as it has for nearly all of the last three years.
Metro 7/21 Rent Changes 6/21 Median Rents
Phoenix +18.9% $1,830
Miami +17.0% $2,184
Las Vegas +14.3% $1,934
Tucson +13.9% $1,685
Austin +13.6% $1,793
Dallas +12.6% $1,814
Charlotte +11.0% $1,588
Atlanta +10.3% $1,647
San Diego +10.1% $3,066
San Francisco +10% NA
Houston +9.2% $1,562
Seattle +8.8% $2,882
Orlando +8.2% $1,675
New York +6.2% $2,767
Los Ángeles +6.0% $3,072
Honolulu +5.7% $3,142
St. Louis +4.7% $1,321
Washington +4.1% $2,523
Philadelphia +2.9% $1,496
Chicago +0.2% $1,976
Boston is the only one of 20 metros that saw its annual rent decline in July.
Rent Price Increases by Property Tiers
Higher-end single-family homes (worth 125%+ of an area’s median price) experienced the largest rental price increase (and the fastest increase in high-price rents in the history of the SFRI) at +9.8%. Higher-middle priced single-family home rental saw increases of +8%. Lower-middle tier single-family home rentals experienced an increase of +7.2% in July and lower-prices single-family rental homes saw an increase of +5.9% (the fastest rent price increase in low-price rents since April 2006).
Also, rent growth for single-family detached home rentals (+10.4%) was more than twice that of single-family attached home rentals (+4.5%).
Thanks to CoreLogic.