The CoreLogic SFRI hit a milestone in August with all major metros covered showing positive rent growth for the first time since April 2020. While increases in rents are an encouraging sign that local economies are improving, they can prove difficult for families facing affordability challenges.
“Converging economic trends are driving a surge in single-family rent prices, and consumer confidence has driven an uptick in demand for both renters and buyers,” said Molly Boesel, principal economist at CoreLogic. “Meanwhile, consumers continue to relocate as they return to in-person work and school. The ongoing preference toward more living space — and slim for-sale inventory — is forcing would-be buyers back into renting, putting significant strain on the single-family rental market.”
To gain a detailed view of single-family rental prices, CoreLogic examines four tiers of rental prices. National single-family rent growth across the four tiers, and the year-over-year changes, were as follows:
- Lower-priced (75% or less than the regional median): 7.1%, up from 2.4% in August 2020
- Lower-middle priced (75% to 100% of the regional median): 8.1%, up from 2% in August 2020
- Higher-middle priced (100% to 125% of the regional median): 9.2%, up from 2% in August 2020
- Higher-priced (125% or more than the regional median): 10.5%, up from 2.3% in August 2020
As unemployment continues to steadily decline, air travel picks back up and tourism gains more traction, rental markets in popular tourist destinations showed strong signs of recovery in August. Among the 20 metro areas shown in Table 1, Miami had the highest year-over-year increase in single-family rents in August 2021 at 21.4%. This is the first time in 32 months that Phoenix did not claim the top spot, and instead logged the second-highest rent price growth with a gain of 19.2%, followed by Las Vegas’ gain of 15.4%. And after 14 months of declining rent prices, Boston logged its first annual increase as renters return to the metro for in-person work and school.
The next CoreLogic Single-Family Rent Index will be released on November 16, 2021, featuring data for September 2021. For ongoing housing trends and data, visit the CoreLogic Intelligence Blog: www.corelogic.com/intelligence.
