Midwest sees rising rents while southern cities experience declines

Rent prices have seen a decline for the 14th consecutive month, according to a recent report by Realtor.com. In September, the median asking rent across the 50 largest metropolitan areas was $1,743, which is $8 less than what renters paid at the same time last year.

The average rent for a two-bedroom apartment in September was $1,930, showing an $8 decrease from the previous year. Similarly, one-bedroom apartments were priced at $1,623 and studios at $1,442, marking declines of $8 and $34 respectively.

Despite this overall drop in rental prices, there is a noticeable regional divide within the rental market. Eight out of ten Midwestern markets among the largest 50 metros experienced annual rent increases in September. Danielle Hale, chief economist at Realtor.com, attributes this to "the balance between housing supply and demand" being a significant factor influencing regional rent patterns. She notes that strong affordability and a robust labor market in the Midwest have led to demand outpacing supply.

In August, the average unemployment rate across these top 50 metros was 4.2%. However, cities like St. Louis and Minneapolis reported lower unemployment rates of 3.9%, correlating with observed rent increases.

Additionally, some of the most expensive rental markets in the West and Northeast continue to see year-over-year growth rates. San Jose, CA saw an increase of 2.6%, while New York City rents rose by 2.8%. Jiayi Xu, an economist at Realtor.com states that "despite weak labor market conditions," demand in these populous areas continues to exceed limited rental supply.

Cincinnati recorded the fastest-rising rents over the past year with a growth rate of 3.4%, bringing its median rent to $1,393.

Other cities experiencing notable increases include Washington D.C., New York City, St. Louis MO., San Jose CA., Louisville KY., Sacramento CA., Minneapolis MN., Oklahoma City OK., and Portland OR.

Conversely, eight out of ten markets with significant annual rent declines were located in the South. According to Hale, an influx of new multifamily housing developments is "easing competition among renters and driving down prices."

Nashville TN saw rents decrease by 4.8% over the past year with a current median asking rent of $1,578.

Other cities where rents declined include Dallas TX., Denver CO., Austin TX., Birmingham AL., Memphis TN., San Diego CA., Atlanta GA., Miami FL., and San Antonio TX.