It’s a good time to own a single-family rental: Rent prices hit double-digit growth in September, according to CoreLogic’s latest Single-Family Rent Index. Rent growth across all tiers continues to be at record highs. High-end rentals are seeing the most growth.
Overall, national rents rose 10.2% year over year, increasing from a 2.6% annual rise a year earlier in September 2020, CoreLogic reports. Miami posted the highest year-over-year rent price increase in September—25.7%, according to CoreLogic’s data.
The competitive purchase market for homes is creating a large wave of demand for single-family rentals that offer greater financial flexibility, CoreLogic researchers note in the report.
However, the single-family rental market is facing similar supply challenges as the for-sale market. Rents likely will continue to increase due to that demand and as a greater number of renters seek out more living space.
“Single-family rental vacancy rates remained near 25-year lows in the third quarter of 2021, pushing annual rent growth to double digits in September,” says Molly Boesel, principal economist at CoreLogic. “Rent growth should continue to be robust in the near term, especially as the labor market improves and the demand for larger homes continues.”
Price Growth Across Tiers, Metros
Here’s a closer look at single-family rent growth across the four pricing tiers in September:
- Lower-priced (which reflects 75% or less than the regional median price): 8.3%, up from 2.4% in September 2020
- Lower-middle priced (75% to 100% of the regional median): 9.3%, up from 2.3% in September 2020
- Higher-middle priced (100% to 125% of the regional median): 10.5%, up from 2.4% in September 2020
- Higher-priced (125% or more than the regional median): 11%, up from 2.8% in September 2020