Attached Single-Family Rents Fall for First Time in 14 Years

Attached Single-Family Rents Fall for First Time in 14 Years

Rents for attached single-family homes registered an annual decrease for the first time in 14 years during March, according to the latest data.

Attached single-family home rents dropped 0.6% between March 2023 and March 2024, data and analytics provider CoreLogic's Single-Family Rent Index showed. That’s lower than in February when rents grew 2.6% on an annual basis. The index measures rent changes for both attached single-family houses — such as duplexes, townhouses and rowhouses — as well as detached single-family houses and condos using listing data on multiple listing services.

The data comes at a time when homeownership is becoming increasingly out of reach. High home prices and mortgage rates, combined with a shortage of houses, are keeping some prospective buyers out of the market and pushing them into the rental market.

At the same time, townhouse construction is on the rise. Between the first quarter of 2023 and the first quarter of 2024, construction starts for single-family attached houses grew 45%, totaling 42,000, according to an analysis from the National Association of Home Builders. The four-quarter moving average market share, or the average percentage of all starts that are townhouses, is now at an all-time high, analysts said.

To be clear, the broader single-family rental market is still showing growth, albeit slow growth. In March, single-family rents grew 3.4% compared to the same month the previous year, according to the CoreLogic index. Median rents lag the rent index, but in February the median monthly cost for a three-bedroom single-family rental home was $2,052.

“The continued strength in single-family detached rents indicates that potential homebuyers who are priced out of the home-purchase market are choosing to rent similar alternatives,” Molly Boesel, CoreLogic’s principal economist, said in a statement.

Regional Highlights

The index tracks 20 metropolitan areas, too. Of those areas, only six saw rents beneath the national average and only three saw declines in rents on an annual basis. All three of those metropolitan areas — including New Orleans, Miami, and Austin, Texas — are in the South.

The decreases are at least partly attributable to overbuilding, according to Boesel.

Analysts said the steepest increases in rents were concentrated around “coastal job hubs.” Seattle saw the highest rent growth, with single-family year-over-year rent change reaching 6.3%. The White Plains, New York, and Jersey City, New Jersey, areas together saw the second highest rate of growth with a 5.3% increase in rents. Boston was third with a 5.2% increase.

San Diego had the highest rent for a single-family home as of February, with a median rent of nearly $3,900. Los Angeles, Honolulu, Seattle, and Boston, as well as White Plains and Jersey City, New Jersey, also had median rents above the $3,000 threshold. Median rent data lags the index by a month.

That growth “indicates that Americans who rent in expensive metros can shoulder the additional cost burden, thanks to higher wages in many job sectors and a U.S. unemployment rate that has remained below 4% for more than two years,” according to the report.

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