CoreLogic®, a leading global property information, analytics and data-enabled solutions provider, today released its latest Single-Family Rent Index (SFRI), which analyzes single-family rent price changes nationally and across major metropolitan areas.
Rent price gains declined in December for the eighth straight month on an annual basis, but the 6.4% national increase remained higher than pre-pandemic levels. Although major tech company layoffs are making headlines, a still relatively healthy U.S. job market is keeping rent prices elevated, with the national unemployment rate hovering near a decade low in December. The job market’s impact on rental price growth has been particularly evident in cities like Miami, which led the country for annual increases throughout most of 2022. Miami’s unemployment rate was 1.6% in December, the lowest of the 20 metros for which CoreLogic publishes rental cost data.
“U.S. single-family rental price growth closed out 2022 at about half of what it was one year ago,” said Molly Boesel, principal economist at CoreLogic. “However, while rent growth has been slowing, it still rose at more than double the pre-pandemic rate. Rental price gains began increasing near the end of 2020 and have risen by about an average of $300 in the past two years. Annual single-family rent growth is projected to slow throughout 2023, but it will likely not decline by enough to wipe out gains from the past two years.”
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:
Of the 20 metro areas shown in Table 1, Orlando, Florida posted the highest year-over-year increase in single-family rents in December 2022, at 10.8%. Miami recorded the second-highest gain at 9.9%, while Boston ranked third at 9%. Phoenix saw the lowest annual rent price gain at 1.2%.
Differences in rent growth by property type emerged after COVID-19 took hold as renters sought standalone properties in lower-density areas. This trend drove an uptick in rent growth for detached rentals in 2021, while the gains for attached rentals were more moderate. As single-family rent prices continued growing rapidly, preferences for attached rentals began to emerge in early 2022, and by summer, they had higher increases than detached properties. Attached single-family rental prices grew 7% year over year in December compared to the 5.4% increase for detached rentals.
The single-family rental market accounts for half of the rental housing stock, yet unlike the multifamily market, which has many different sources of rent data, there are minimal quality adjusted single-family rent transaction data. The CoreLogic Single-Family Rent Index (SFRI) serves to fill that void by applying a repeat pairing methodology to single-family rental listing data in the Multiple Listing Service. CoreLogic constructed the SFRI for close to 100 metropolitan areas — including 47 metros with four value tiers — and a national composite index. The indices are fully revised with each release to signal turning points sooner.
The CoreLogic Single-Family Rent Index analyzes data across four price tiers: Lower-priced, which represent rentals with prices 75% or below the regional median; lower-middle, 75% to 100% of the regional median; higher-middle, 100%-125% of the regional median; and higher-priced, 125% or more above the regional median.
Median rent price data is produced monthly by CoreLogic RentalTrends. RentalTrends is built on a database of more than 11 million rental properties (over 75% of all U.S. individual owned rental properties) and covers all 50 states and 17,500 ZIP codes.
To learn more about the data behind this article and what CoreLogic has to offer, visit https://www.corelogic.com/.
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