National rent growth slowed to 4.7% annually in October--its slowest pace in 18 months—with average rents hitting $1,734, according to Realtor.com’s October Rental Report.
Despite the reprieve for rentals, it may be short-lived, but Realtor.com’s 2022 Fall Landlord and Renter Survey found tenants are struggling with affordability and many are planning rent increases over the next year.
"With soaring inflation and recession fears a huge concern for many consumers, finding affordable housing remains a priority for families. Our data indicates that we are finally starting to see a bit of relief from the double-digit pace of rent growth that we experienced during the height of the pandemic," said Danielle Hale, Chief Economist at Realtor.com. "While it's still a bit early to say that we're officially on a downward trajectory for rent prices, the data shows a promising return toward normal seasonal slowdowns and suggests that the astronomical price gains of the past several years may be behind us."
According to the report, the median rent in the top-50 U.S. metros in October was $1,734, which is down $25 month-over-month and $47 from its July peak.
October is the third consecutive month of single-digit growth and the ninth consecutive month of slowing. However, the pace of growth was still nearly 1.5 times faster than it was in March 2020 before the COVID pandemic hit.
While lower rents are a welcome sight, affordability is still a concern. The report states that 69.5% of those surveyed who experienced an increase are considering moving for more affordable rent, which is up from 66.2% in July.
"While it's encouraging to see smaller price increases, it's important to understand that many renters have already absorbed large increases in their monthly rental costs over the past several years, which is impacting their ability to save," said Ryan Coon, VP of Rentals at Realtor.com. "High inflation and the cost of upkeep and repairs are hitting landlords, who have had to raise rents to cover their higher cost of owning the properties and making it unlikely that they'll be open to negotiating with new tenants."
Realtor.com reported just 32.3% of renters are considering purchasing a home in the next year--down from 34.6% in July. The most common reason is not having enough savings for a down payment (44.4%) and fear they would not qualify for a mortgage (19.6%).