Rental Markets Are Cooling But Rents Still Far Exceed Pre Pandemic Levels

Rental Markets Are Cooling, but Rents Are Still Far Exceeding Pre-Pandemic Levels

The Rental Market is Cooling

After months of skyrocketing rental prices, it seems relief might be on the horizon. The national median rent decreased in December, marking the first month-over-month dip since the start of the pandemic. The average monthly rent for a one-bedroom apartment fell to $1,326, representing a modest 0.5% decrease from November. Two-bedroom units saw a slightly higher decline, with the median rent falling to $1,473 per month, down 0.4% from the previous month.

Rents Are Still High

Despite the recent cooling, rental costs remain significantly elevated compared to pre-pandemic levels. The national median rent for a one-bedroom apartment is still 14% higher than it was in February 2020, before the pandemic's onset. Two-bedroom units are even more expensive, with median rents almost 16% above pre-pandemic levels.

Factors Contributing to High Rents

Multiple factors have driven the relentless rise in rental costs over the past two years, including: * Low inventory: The construction of new rental units has not kept pace with the surge in demand. * Increased demand: The remote work trend and changing housing preferences have led to increased demand for rental units. * Inflation: Rising construction and operating costs have been passed on to tenants.

Outlook for 2023

Experts predict the rental market will continue to moderate in 2023, with the rate of rent increases slowing down. However, they caution that rents are unlikely to return to pre-pandemic levels anytime soon.

Tips for Renters

* Be flexible: Consider renting in less popular areas or exploring alternative housing options like co-living. * Negotiate: Don't be afraid to ask for concessions, such as a lower rent or reduced fees. * Consider roommates: Sharing housing costs with roommates can help reduce your monthly expenses. * Take advantage of rental assistance programs: Federal and local governments offer programs that can help low-income renters with their housing costs.

Sources

* [Zillow Rental Market Report](https://www.zillow.com/research/december-2022-national-rent-report-39894/) * [Apartment List National Rent Report](https://www.apartmentlist.com/research/national-rent-report) * [National Low Income Housing Coalition](https://nlihc.org/our-work/research-reports/gap-report)