(NASDAQ: RDFN) —The median asking rent fell across all bedroom counts in July year over year, the first time that’s occurred since June 2020. That’s according to a new report from Redfin (redfin.com), the technology-powered real estate brokerage.

Median asking rents for 0-1 bedroom apartments fell 0.1% (to $1,498 a month), 2 bedroom apartments fell 0.3% (to $1,730) and 3+ bedroom apartments fell 2.4% (to $2,010). All three categories are down at least $50 from all-time highs posted in the last two years.

Prices remained steady for 0-1 bedroom and 2 bedroom apartments due to higher demand in those categories, even with increased supply coming onto the market. The increased supply of 3+ bedroom apartments, however, led to prices falling faster in July due to lower demand for larger, more expensive units which also compete against single-family home rentals.

The overall rental vacancy rate has remained at 6.6% for four consecutive quarters, the highest level since 2021, while the vacancy rate for buildings with 5+ apartments—the subject of Redfin’s report—was at 7.8% in the second quarter, up from 7.4% a year earlier.

“Rents have recently steadied—or even dropped slightly—because of the sheer number of apartments built over the past two years,” said Redfin Senior Economist Sheharyar Bokhari. “Construction is slowing down and prices will eventually start rising again, but now is still a good time for renters to find a deal, especially families looking for an apartment with at least three bedrooms.”

Nationwide median asking rent rises slightly, but still down $53 from all-time high

The median asking rent for all bedroom counts combined actually rose 0.4% year over year in July to $1,647. This discrepancy between the combined result (showing a gain) and the three different bedroom types (which all fell) is the result of a statistical phenomenon known as Simpson’s paradox.

The national median asking rent was down 0.2% month over month from June and $53 less than the all-time high of $1,700 recorded in August 2022. Despite the slight dip, affordability is still a serious issue for renter households, which earn roughly $11,000 less than is needed to afford a typical apartment.

Rents drop across Sun Belt, as East Coast and Midwest cities record big increases

Metro areas in Texas and Florida, two states which have built a high number of new apartments since the pandemic, continue to see large falls in price.

The median asking rent in Austin, TX dropped the most of any metro we analyzed in July, falling 16.9% year over year. Jacksonville, FL, was not far behind, with the median asking rent falling 14.3%.

San Diego (down 12.7%), San Francisco (down 7.6%) and Tampa, FL (down 5.9%) rounded out the five metros with the biggest drops in asking rents.

The median asking rent in Virginia Beach, VA rose 13.7% year over year in July, the biggest jump among the metros Redfin analyzed. Baltimore, MD (up 12.5%), Washington, D.C. (up 11.6%), Chicago (up 10.3%) and Cincinnati, OH (up 9.9%) posted the next highest gains.

To view the full report, including charts, metro-level data and methodology, please visit: https://www.redfin.com/news/rental-tracker-july-2024

About Redfin

Redfin (www.redfin.com) is a technology-powered real estate company. We help people find a place to live with brokerage, rentals, lending, title insurance, and renovations services. We run the country's #1 real estate brokerage site. Our customers can save thousands in fees while working with a top agent. Our home-buying customers see homes first with on-demand tours, and our lending and title services help them close quickly. Customers selling a home can have our renovations crew fix it up to sell for top dollar. Our rentals business empowers millions nationwide to find apartments and houses for rent. Since launching in 2006, we've saved customers more than $1.6 billion in commissions. We serve more than 100 markets across the U.S. and Canada and employ over 4,000 people.

Redfin’s subsidiaries and affiliated brands include: Bay Equity Home Loans®, Rent.™, Apartment Guide®, Title Forward® and WalkScore®.

For more information or to contact a local Redfin real estate agent, visit www.redfin.com. To learn about housing market trends and download data, visit the Redfin Data Center. To be added to Redfin's press release distribution list, email press@redfin.com. To view Redfin's press center, click here.

View source version on businesswire.com: https://www.businesswire.com/news/home/20240813308488/en/