Rents are on the rise again across most of the country, according to the latest Single-Family Rent Index released by global analytics firm CoreLogic.
While rent growth stalled in the early months of the pandemic, prices have steadily picked up since. November 2020 data showed a national rent increase of 3.7% year over year, up from a 2.8% year-over-year increase in November 2019, the highest annual growth since June 2016.
Meanwhile, rental vacancies for one-unit homes fell to their lowest levels since 1994, contributing to increases in rent prices. While single-family inventories fell at all price tiers, the lowest-priced rentals fell the least, according to the report.
Rent price growth among lower-priced rentals has lagged for most of the pandemic, the only tier to trail last year’s levels, although limited supply is expected to drive stabilization.
“Rent increases for single-family properties rebounded in recent months and in November exceeded the pre-pandemic rate,” said CoreLogic Principal Economist Molly Boesel in the report. “This is in contrast to rents for multifamily properties, which have decreased as tenant preferences shifted away from high-density apartment buildings to low-density, single-family homes.”
Among the 20 metro areas CoreLogic analyzed, Phoenix had the highest year-over-year increase in single-family rents in November 2020 at 9.9%. Conversely, Boston saw annual declines in rent prices of 4.6%, the largest decrease in all analyzed metros’ rent prices for four consecutive months, likely due to the decreased number of college students moving to the city, said the report.
In Chicago, rent prices were down slightly at 0.5% in November, compared to a year earlier.
The report noted that as the economy recovers from the pandemic’s impact, we may see rent prices rise in metros across the nation.