The Cost of Rent Is Finally Dropping — But Probably Not For Long
Experts say we shouldn’t get too excited.
Following months of rising rent costs, there’s a small glimmer of hope, at least according to new data. The cost of renting an apartment is falling in some cities, which is welcome news for parents who are dealing with tight budgets and tighter wallets as inflation continues to drive up food prices. Unfortunately, it looks like this minor reprieve from ever-rising rents will be temporary.
Following months of escalating rent prices, the national average asking price for both one- and two-bedroom apartments has fallen slightly, according to Rent.com. The median rent across the country for a one-bedroom apartment fell 2.8% month-over-month to $1,721, while two-bedroom rental prices dropped 2.5% to $2,054.
The drop is welcome news after many months of skyrocketing rental prices, with some cities having seen hikes up to 25% in 2021, CBS News notes. In February of 2022, Fatherly covered a report from Redfin that noted the average cost of rent nationwide had jumped 14%, but that in some cities, rent had gone up by 40%, a walloping cost increase for a basic necessity.
Looking to another report from Realtor.com, the median rental prices in August saw the country’s 50 largest cities drop to an average of $1,771.
All this is good news for parents struggling to make ends meet. But unfortunately, there’s a reason why experts are telling people to take it all with a grain of salt.
"I wouldn't get too excited over a reduction in rental prices," Nest Seekers International chief economist Erin Sykes told CBS News. "I think it's more of a plateau."
Sykes said that while prices dropped between July and August, it’s not likely we will see it drop any more this year. "So, if you need a place to live, if you need a new rental, it is a good time to enter into it because it's not going to get any better," she warned.
Rent.com noted that the rent drop is likely tied to an uptick in the number of available apartments, softening demand, and “painfully high inflation continues to outstrip wage growth and diminish most people's purchasing power, effectively putting a lid on what landlords can ask for.”
According to Rent.com, these 10 U.S. cities have seen the steepest drop in the cost of a two-bedroom apartment in August compared with a year ago.
- Charlotte, NC (↓27.3 %)
- El Paso, TX (↓25.2 %)
- Des Moines, IA (↓22 %)
- New Orleans, LA (↓21.3 %)
- Reno, NV (↓19.1 %)
- Tallahassee, FL (↓18.3 %)
- Saint Louis, MO (↓17.8 %)
- Lincoln, NE (↓15 %)
- North Las Vegas, NV (↓13.3 %)
- Irvine, CA (↓12.7 %)
For the full report on the decrease in rents and what trends are happening in your city, check out Rent.com.