Rent prices in the United States fell for the second month in a row in October.
According to new data from Yardi Matrix, rent fell from $1,421 to $1,420 in October. Rent growth was unchanged from the previous month, coming in at 3.3% year-over-year.
Is the colder weather to blame for the dip in prices? Yardi explained that the overall slowdown follows an anticipated seasonal trend and that rent gains increased in warmer weather markets like Las Vegas, Phoenix and Atlanta. Overall, no market looks to be in serious trouble though, the report explained.
“The strength of the national market is demonstrated by the fact that rent growth is less than 2% in only a handful of metros, and the lowest is Houston at 1.6%. No market is even remotely in trouble,” the report said, adding that the groove the market is experiencing will be difficult to change if employment and wage growth “maintain their current path.”
The leaders for year-over-year rent growth for October were Las Vegas, Phoenix, Orlando, and the Inland Empire and San Jose metros in California.
Yardi's report explained that it expects full-year rent increases to fall in line with the current YTD number.
“We expect that the full-year rent increase for 2018 will remain near the year-to-date figure of 3.3%, with occupancy rates stable at current high levels,” the report said.
The report also shows that the rate of growth has increased more than 100 basis points over the past 12 months and that rent-by-necessity units came in at 3.9%, outpacing lifestyle units, which came in at 2.6%. The report noted, however, that there was solid growth in both sectors that underscores a high demand for rental housing.
Note: Yardi’s report is composed of multifamily data collected from 127 U.S. markets.
