The national median rent was up 0.2 percent in June, ticking up for the fifth consecutive month, and now sits at $1,401, according to the July report from Apartment List.
“But after increasing by 0.6 in March, our national rent index has seen its growth rate trending down over the past three months, at odds with the typical seasonal trend,” writes the Apartment List Research Team.
“The late spring and summer months are normally the peak season for moving activity, and rent growth tends to ramp up at this time of year in tandem with demand. The fact that we’ve instead seen rent growth get increasingly sluggish indicates softness in the market, possibly reflecting declining consumer confidence amid a more uncertain macroeconomic outlook,” the report says.
Research team highlights of the report
- Year-over-year rent growth had been close to flipping positive for the first time since 2023, but has now ticked further negative for the past two months.
- The national multifamily vacancy rate currently stands at 7%, “the highest reading we’ve recorded in our index. We’re past the peak of a multifamily construction surge, but the market is still absorbing all of the new units, and vacancies are still trending up.”
- Units are taking an average of 27 days to get leased after being listed, down from a high of 37 days in January.
- The Austin metro is currently the nation’s softest rental market, with the median rent there down by 6.4% over the past year; San Francisco has seen the fastest year-over-year rent growth (+4.9%).
With the overall trajectory of rents trending modestly downward in recent years, the national median rent has now fallen below its August 2022 peak by a total of 2.8 percent, or $41 per month. But that cooldown came following a period of record-setting rent growth, and the typical rent price remains 22 percent higher than its January 2021 level.
Multifamily vacancy rate hits 7%, a new peak
“We are now past the peak of the apartment construction wave, but even as the level of new supply hitting the market falls sharply compared to last year, it remains robust by historic standards,” the report says.
The vacancy rate will begin to tighten eventually, but for now it continues to rise as the market is still absorbing a swell of new units.
List-to-Lease time comes down from all-time high
This “list-to-lease” time peaked at 37 days nationally in January, an all-time high going back to the start of the data series in 2019.
Since then, however, this time has been getting shorter, and among units that were leased in June, the median time on market was 27 days, down from 28 days in May.
Conclusion
“All of our key indicators are pointing toward a sluggish summer moving season – rent growth is slipping and the multifamily vacancy rate is at an all-time high.
“A return to tighter market conditions should still be on the horizon as the supply wave continues to recede, but the outlook has been complicated by macroeconomic whiplash being caused by tariffs and other policies being pursued by the Trump administration. This uncertainty appears to be weighing on demand, but the magnitude of that impact is not yet clear,” the research team writes.
Read the full report from Apartment List here.
