The national median asking rent rose for the third consecutive month in March to 0.8%. It’s a pattern driven by a number of factors, including the rising costs of buying a home, a new Redfin report revealed.
“Many people are delaying home purchasing plans because monthly payments for homebuyers are near their record high. That’s bolstering rental demand, and as a result, rent prices,” Redfin noted. “The median asking rent in March was just 3.3% ($67) below the record high of $2,054 in August 2022.”
Once again, gains in the Midwest and Northeast far outstripped gains in the South and West. Indeed, rents in the South were largely flat and even fell slightly in the West. That’s largely because these regions have seen a significant increase in apartment supply.
In contrast, median asking rent in the Midwest climbed to $1,456 in March – a hike of 5.3% from the previous year, and a new record. The Northeast also saw a boost of 3.8% to $2,504. With less supply, landlords in these regions were under less pressure to lower rents to fill vacancies, and competition for apartments kept rents up.
The Midwest benefited from being one of the most affordable parts of the country, which helped increase housing demand. And its low unemployment rate coupled with an influx of major tech companies like Google in Kansas City also worked in its favor, Redfin said.
The good news for renters across the country is that rent growth has slowed since the pandemic, remaining below 3% since early 2023, and rents are more predictable. And as households try to curb their spending, they are also resisting rent increases, presenting a challenge for landlords, Redfin said.
