Realtor.com: Rents Fall for 38th Straight Month, but Barely

Asking rents across the largest U.S. metros kept slipping in September, but at the slowest pace in three years, according to Realtor.com's monthly rent report released Oct. 15. For renters, the numbers suggest the era of falling prices is flattening out, with the Bay Area already moving the other way.

The national picture

Realtor.com tracks studios, one-bedrooms and two-bedrooms in the 50 largest metros. The median asking rent was $1,694 in September, down 0.4% from a year earlier. That was the 38th consecutive month of annual declines. Rents sit about $80 (roughly 4.5%) below the August 2022 peak, but 14.5%, or $214, above the pre-pandemic level.

By unit size, the median asking rent was $1,422 for studios (down 1.0%), $1,568 for one-bedrooms (down 0.4%) and $1,890 for two-bedrooms (down 0.3%).

Where rents rose and fell

• Biggest increases: San Jose, +6.0% to $3,565 (a new high); San Francisco, +4.8% to $3,057; Milwaukee, +2.6% to $1,749; Kansas City, +2.4% to $1,380; Chicago, +2.3% to $1,909 (a new high); St. Louis, +2.0% to $1,300.
• Biggest decreases: Memphis, -4.6% to $1,048; Cleveland, -4.4% to $1,185; San Antonio, -3.8% to $1,124; Tampa, -3.1% to $1,608; San Diego, -2.7% to $2,672; Denver, -2.7% to $1,753.

Concessions

Landlords are still discounting. Realtor.com found 43.9% of listings offered concessions, such as a free month, up 1.3 percentage points from a year earlier. Denver had the highest share among the metros in the report's table, at 73.1%, and Austin was at 70.6%. In San Jose the share fell to 24.3% from 51.9% a year ago, and in San Francisco to 28.1% from 47.6%.

Realtor.com senior economist Jiayi Xu described the combination of higher rents and shrinking discounts as a “one-two punch” for Bay Area renters.

How it compares with other data

Different rent indexes measure different things, so their levels and trends differ. Apartment List's October report, based on September data, put its national median at $1,388, down 0.1% from August and down 0.4% from a year earlier, with a national vacancy rate of 7.0% and typical time to lease of 34 days. It also showed San Francisco up 11.0% year over year and San Jose up 7.9%, versus 4.8% and 6.0% in Realtor.com's data. Both sources agree on the direction: the Bay Area is rising and Sun Belt metros such as Austin, Phoenix, Denver and San Antonio are still falling. We covered that report in our earlier story on vacancy and rent rebound signs.

One caution: the Realtor.com release is internally inconsistent in places, giving the decline from the 2022 peak as both 4.5% and 4.6%, so treat small differences as approximate.

What this means for renters

• Negotiate on concessions. With nearly 44% of listings offering them, ask about a free month or waived fees, but compare the effective rent over the full lease term.
• Expect renewals to differ by city. In markets where rents are rising, such as San Francisco and San Jose, landlords have less reason to bargain. In falling markets such as Memphis, Cleveland and San Antonio, you may have room to negotiate.
• Check notice rules. Many states and cities require advance written notice of rent increases. See our guides on tenant rights before agreeing to a renewal.

Cooler markets are not guaranteed to stay that way. Apartment List's recap noted that demand is uncertain, with renter search urgency having stalled, and that new apartment construction is slowing.