It was a small decline, but a decline nonetheless! The median U.S. asking rent fell 0.8 percent annually in December to $1,964, according to brand new numbers out from Redfin. That’s the third consecutive decline, following a 2.1 percent annual drop in November—the largest since 2020—and a 0.3 percent dip in October.
“High supply—more so than low demand—is driving rent declines. But if mortgage rates continue to drop at a fast clip in 2024, slowing rental demand could become a major driver of rent declines,” said Redfin Economics Research Lead Chen Zhao. “That’s because more Americans would ditch the rental market to become homeowners, leaving landlords with even more vacancies.”
Per Redfin, rents dropped in the South and the West (down 0.6 percent to $2,346), but continued climbing in the Midwest and Northeast.
Of note, there are more newly built and under-construction apartments in the U.S. than there were a year ago, while the number of completed apartments is near the highest level in more than 30 years.