Rent prices are significantly higher than they were at the same time last year, rising by a nationwide 3.8 percent in January.
According to the latest Single-Family Rent Index report from CoreLogic released on Tuesday, rent price growth remained stable from December to January. That said, the number is still much higher than it was in January 2020 pre-pandemic, when only a 2.9 percent increase was observed.
This type of growth indicates that the pandemic did little to curb demand for rental housing and the accompanying increase in prices. Such high growth has not been seen since June 2016. Unexpectedly, growth of lower-end homes worth less than 75 percent of an area’s median price dropped from 3.7 percent in 2020 to 2.9 percent now, but all other types of homes saw large increases. Homes worth more than 125 percent of an area’s median saw the highest jump from 2.5 percent in 2020 to 4.2 percent now.
“As rising home prices persist, some prospective buyers are being priced out of the housing market, keeping many households as renters,” Molly Boesel, principal economist at CoreLogic, said in a prepared statement. “This demand for rentals will push down single-family rental vacancy rates and put further upward pressure on rent growth this year, especially as the economy continues to recover.”
Month after month, Phoenix continues to report growth unparalleled anywhere else in the country — single-family home prices jumped 11 percent compared to last year. Tucson, Arizona and Charlotte, North Carolina, came close behind, at 9.8 and 7.6 percent, respectively, while Boston and Chicago saw its growth decrease likely due to the high numbers of students leaving the city amid college closures.