In what is being billed as the smallest rent increase in 20 months, Redfin found that national rents rose just 2.4 percent in January. That’s roughly one-sixth the pace of January 2022, when rents were up 15.6 percent from a year earlier.
“We’re watching closely to see whether rents start falling year over year. That would be a welcome relief for renters because it hasn’t happened since the onset of the pandemic,” said Redfin Chief Economist Daryl Fairweather. “If rents do start falling on a year-over-year basis, it will mean that renters have more room to negotiate. It may also prompt more landlords to sell their properties because they’re no longer getting a good return on their investment.”
Redfin found 11 metros where rents are already falling, though none are in California. In Phoenix, the median asking rent declined 6.7 percent year-over-year in January, the largest drop among the 50 most populous U.S. metropolitan areas. Next came Oklahoma City ( down 6.3 percent), New Orleans ( down 5.2 percent), Minneapolis ( down 5.1 percent) and Houston ( down 4.9 percent).
In Los Angeles, rents were up just 0.8 percent in January, while Riverside saw rents jump 3.5 percent. San Diego had one of the larger increases, up 4.7 percent.