Rent prices rose dramatically as supply struggled to keep up with demand

Rent prices in 2022 were 12.8% higher than they were in 2021. Nationwide, the median rent price rose to $2,053 in August before dipping slightly, the highest on record and a 12.3% increase year-over-year. Following the pandemic, rent prices skyrocketed largely because of a lack of supply and a boom in demand, both of which are just now balancing out.

• Median rent prices in New York rose to over $4,000, retaining its dominance as the most expensive metro for renters in the country.
• Many of the least expensive metros experienced the highest year-over-year rent increases, including Oklahoma City (23.3%), Cincinnati (17.6%), and Pittsburgh (14.8%).
• Oklahoma City experienced the highest year-over-year rent increases in the country.  
• Rent growth has consistently outpaced wages for decades, but the most recent data states that a staggering 40% of renters spent more than 30% of their income on rent from 2017-2021.

There are currently over 1.1 million rental units under construction in the U.S., which will come available for rent over the next year, helping to alleviate part of the housing shortage.

“We expect rents to fall in nearly every part of the country by the middle of 2023 as supply starts overtaking demand,” notes Taylor Marr, Redfin Deputy Chief Economist. “While renters typically get the best deal during the winter months as demand is lower, rents are continuing to ease. Because of this, there won’t be as much of a seasonal increase come spring, and thus patience for a good deal will pay off. And don’t be afraid to negotiate; some landlords may be open to concessions like a free month’s rent or free parking.” 

• Published on December 29, 2022
• by Jamie Forbes