CoreLogic has released its latest Single-Family Rent Index (SFRI) covering the month of June 2022 found that in some areas of the country, the unrelenting pace a which rent growth has been growing slowed a bit, yet continues to post year-over-year double-digit growth.
For the month of June, single-family rent prices remain elevated, now up 13.4% year-over-year, but this number is relaxing from data seen in previous months this year. According to CoreLogic, this deceleration, however minor, could partially be due to worries over an “impending” economic slowdown, even in light of strong jobs numbers.
Still, the cost of owning a home continues to grow significantly month-by-month, shutting many Americans out of the market, forcing them to keep renting.
“While the annual growth in single-family rents is nearly double that of a year ago and is still near a record level, price growth began decelerating in June,” said Molly Boesel, Principal Economist at CoreLogic. “Nationwide, both year-over-year and month-over-month growth were slower in June than they were earlier this year, and roughly half of the largest U.S. metro areas experienced a slowdown in annual growth in June.”
Preferences for rental types could be shifting, as annual attached rent price growth (13.2%) slightly outpaced detached price growth (12.8%) for the first time since February 2020.
By the numbers:
- Lower-priced (75% or less than the regional median): 14.2%, up from 5.6% in June 2021
- Lower-middle priced (75% to 100% of the regional median): 14.2%, up from 6.4% in June 2021
- Higher-middle priced (100% to 125% of the regional median): 14%, up from 7.1% in June 2021
- Higher-priced (125% or more than the regional median): 12.5%, up from 9.4% in June 2021
Of the top-20 metropolitan areas, Miami posted the highest year-over-year increase in single-family rents in June at 35.5%, the 11th consecutive month it has topped the nation by leaps and bounds for rent price growth. This was followed by Orlando, Florida, and San Diego who saw gains of 23.3% and 15.2%, respectively.
Honolulu and St. Louis posted the lowest gains, with both averaging a 6.6% increase.
The pandemic changed renters preferences as more looked to flee urban areas to suburbs with single-family homes. This trend drove rent growth for detached rentals in 2021, while the gains for attached rentals were more moderate. But June’s data shows this trend has now shifted, as attached rental property prices grew by 13.2% year-over-year, compared to the 12.8% increase for detached homes, the first time since February 2020 that attached properties outpaced detached properties.
Still, overall rent price growth for detached homes (24.9%) versus attached homes (18.8%) remains stronger on a two-year basis.