National Average Rent Declined for the First Time in Two Years

-edited

The National Average Rent declined for the first time in two years, dipping a mere $1 to $1,471.

The Rent Cafe Apartment Market Report for September shows a rare decline in the National Average Rent.

Key Findings

  • The national average rent went up by 3.2% in the past year but dipped by 0.1% month-over-month, reaching $1,471 in September according to data from Yardi Matrix.
  • Apartment rates in a majority of small and large cities registered either minor decreases or stagnated. 
  • In more than half of the nation’s largest renter hubs rent prices waned since August. 

Since last month, apartment rents saw minor declines in more than half of the cities we analyzed. Small and large cities lead the trend, with prices dropping in 59% of small cities and 56% of large cities, while 42% of mid-sized cities saw their rates dwindle in September.

September Rents in the 20 Largest Mega-Hubs

CPI Rent and Owners' Equivalent Rent Month-Over-Month

The Rent Cafe does not use seasonal adjustments, so for comparison purposes the last time the BLS had rents dipping was March of 2010.

Year-Over-Year Rent Cafe

Year-Over-Year CPI

The numbers are not directly comparable because the Rent Cafe uses dollars while the BLS uses an index. Also Rent Cafe Data does not go back as far as the BLS.

I would have liked to seen Rent Cafe data for 2007-2010 to see how they stacked up.

September 2019 vs September 2018

  • The Rent Cafe says the national average rent went up by 3.2%.
  • The BLS says rent of primary residence went up 3.8%
  • The BLS says Owner' Equivalent Rent went up 3.4%

The numbers that we do have align quite well.

Mike "Mish' Shedlock

Comments (14)
No. 1-5
Harry-Ireland
Harry-Ireland

That's a twisted sense of humour, Mitch. A decline of 1$ ;)

Advancingtime
Advancingtime

Too much money with a shortage of good investment opportunities has resulted in a boom in multi-family construction. These new apartment complexes built on cheap money are beginning to pressure existing home prices. This and a combination of other trends have long term implications for the economy and society. The article below explores some of the ways bad housing policy takes a toll on America.

KidHorn
KidHorn

Looks like supply has caught up to demand. Not surprising. Where I live, almost all new construction is townhouses for sale or apartments/condos for rent. Not many detached homes going up and the few that are cost close to a million dollars.

Tony Bennett
Tony Bennett

"dipping a mere $1 to $1,471"

...

A start.

I follow one rental market closely. "Sold" this year has been running 5% or 6% off of "Ask" ... with a few transactions around 10% off. Numbers don't BEGIN to pencil out till 25% off (unless you are one of those paying all cash and enjoying a cap rate < 5%).

My powder is dry ... and I have no doubt it will be in play in the next few years.

Herkie
Herkie

I could just weep. I am getting a 1.6% COLA raise for 2020, my landlord is going to demand an 11.6% rent increase in January. Now that we have statewide rent control landlords must demand the maximum allowed under the law EVERY year or they lose their rent increase base that they can never get back in future. Only the dumbest landlords will refuse to hike the rents by the allowed amount now, it would be like calling your broker up and saying please only invest me in overpriced dog stocks that are sure to go down.

According to RentJungle.com here is the average rent in my town/county since 2014, they are MONTH; all beds; one bedroom; two bedroom reading from left to right:

2/2015 800 652 765 3/2015 831 605 779 4/2015 868 639 794 5/2015 866 674 777 6/2015 844 659 759 7/2015 894 668 775 8/2015 909 665 778 9/2015 880 663 794 10/2015 860 668 815 11/2015 836 666 835 12/2015 809 656 822 1/2016 818 668 832 2/2016 822 662 829 3/2016 827 687 856 4/2016 797 672 834 5/2016 801 687 843 6/2016 847 699 889 7/2016 827 710 862 8/2016 831 692 818 9/2016 813 704 823 10/2016 824 718 816 11/2016 805 706 822 12/2016 801 692 831 1/2017 816 722 834 2/2017 819 729 849 3/2017 781 694 841 4/2017 792 695 872 5/2017 840 715 851 6/2017 865 693 855 7/2017 886 712 894 8/2017 882 733 890 9/2017 853 719 878 10/2017 886 736 848 11/2017 920 708 850 12/2017 888 720 876 1/2018 922 732 898 2/2018 912 744 893 3/2018 923 769 907 4/2018 875 720 886 5/2018 862 717 865 6/2018 879 760 917 7/2018 896 758 907 8/2018 878 748 913 9/2018 902 806 885 10/2018 858 786 887 11/2018 903 845 990 12/2018 964 841 1,130 1/2019 1,051 872 1,188 2/2019 1,049 774 1,139 3/2019 1,070 742 1,189 4/2019 1,052 727 1,179

I paid $725 for a two bed townhouse in 2013/14 lease, the same place now is $1,300, but the landlord pays none of the services (sewer/water/gas/electric/garbage) where back then he paid garbage and water/sewer.

The rent control law now in effect allows landlords to increase rents by 10% plus the SS COLA increase, for 2020 that amounts to 11.6% and I cannot afford it since my rents are already up about 90%, while my veterans disability is up in the same period by 8.6%. And it is not just rents, food, fuel, auto insurance (200-300% for insurance) every item that remains in my budget is up by at least double digits though I have had to cut many of the things that I used to take for granted and saving is out of the question.

If I disappear from your forum Mish that will be the reason why, it means I had to leave and go homeless, live in my car, or move to a red state that makes me want to slash wrists.