The median U.S. asking rent rose 0.9% year over year in August to $1,645—the biggest annual increase since April 2023. That’s according to a new report from Redfin (redfin.com), the technology-powered real estate brokerage. Rents were up 0.1% on a month-over-month basis.

Rents for 0-1 bedroom apartments ticked up 0.1% year over year to $1,495, while 2 bedroom apartments remained unchanged at $1,725. Rents for 3+ bedroom apartments fell 1.7% to $2,008. The discrepancy between the overall result (showing a 0.9% gain) and the three different bedroom counts (which either fell, remained the same, or rose by a lower amount) is the result of a statistical phenomenon known as Simpson’s paradox.

While rents rose the most in nearly 18 months, August marked two years from when they hit an all-time high. Lower rents, paired with wages growing 3.8% year over year, show that rental affordability has improved.

Multifamily building completions are at historic highs in 2024 and in some areas supply now outweighs demand. That is driving some building owners to reduce rents and offer concessions to prospective tenants.

“Almost everything in our lives costs more than it did two years ago—but rents have remained largely stable thanks to the construction boom, especially across the Sun Belt states,” said Redfin Senior Economist Sheharyar Bokhari. “We are seeing rents tick up a little now that new construction is starting to slow down, but asking rents are likely to stay relatively flat for some time due to the backlog of new apartments that are still coming onto the market.”

Rents in Austin and other Sun Belt metros continue to fall the fastest

The trend of increased construction leading to lower rents is most obvious in Austin, TX where the median asking rent fell 17.6% year over year in August—the steepest decline of the 33 major metros Redfin analyzed. In dollar terms, that means rents in Austin are $317 a month less now than they were a year ago.

Authorities in the Texas capital signed off on the most new construction in the country in an effort to keep up with soaring demand during the pandemic. Demand has now leveled off, but a lot of new apartments are still coming onto the market, so asking rents are falling.

San Diego (-13.3%) and Jacksonville, FL (-13%) also recorded double-digit decreases in asking rents in August, while San Francisco (-7.8%) and Tampa, FL (-5.8%) rounded out the five metros with the largest rent decreases.

The median asking rent in Virginia Beach, VA rose 15.2% year over year in August, the biggest jump among the metros Redfin analyzed. Washington, D.C. (up 12.2%), Baltimore, MD (up 11.3%), Chicago (up 10.8%) and Cincinnati, OH (up 9.4%) 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-august-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/20240910165342/en/