Single-Family Rents Make Another Record Jump

Institutional Investors Have Been Buying Up Single-Family Homes, Pushing Overall Pricing Skyward.

Single-family rents surged again in April, the 13th consecutive month of record-breaking annual gains for the sector.

Prices were up 14% year-over-year nationwide, according to CoreLogic. The annual rent price growth was more than double the April 2021 increase and more than six times higher than the April 2020 growth.

The first phase of the coronavirus pandemic slowed rental gains in early 2020, but rents rebounded by autumn of that year to surpass their pre-pandemic rates.

CoreLogic chalked up the April increase — and that in many previous months — to a combination of a shortage of rental properties and an expanding job market. The U.S. economy added nearly 430,000 new jobs in April, with wages up 5.5% annually.

Rent growth was roughly similar across the spectrum of prices. Lower-priced houses (up to 75% of the regional median) saw rents increase 13.7% year-over-year in April, while higher-priced houses (125% or more than the regional median) recorded an annual increase of 13.5% in April. Houses between those tiers were up between 14.4% and 14.6% for the year.

Miami posted the top year-over-year increase in single-family rents in April, coming in at 40.8%, or about seven times its April 2021 annual growth rate, CoreLogic reports. Orlando, Florida, and Phoenix were the second- and third-highest gainers at 25.8% and 17.8%, respectively. Philadelphia and Honolulu posted the lowest annual rent price growth at 7.8% and 7.7%, respectively.

At the same time as rents for single-family houses rises, housing sales are down, which could put downward pressure on for-sale prices.

Existing-home sales declined in May for the fourth straight month to an annualized rate of 5.41 million units, the National Association of Realtors reported on Tuesday. Sales were down 3.4% from April and 8.6% from one year ago.

Even so, the median existing-home sales price exceeded $400K for the first time, coming in at $407,600 and representing a 14.8% increase from one year ago, according to the NAR.

Still, with interest rates rising, residential property prices could contract an annual 5% by this time in 2023, Capital Economics Senior Property Economist Matthew Pointon said in a research note Monday, as reported by Bloomberg.

Continue reading this story with a free account

Log in or register
Sign up for more articles like this
Subscribe to Bisnow's National Newsletters
Related Stories

Lawmakers Punt On Stripping Approvals From 15 Projects In Data Center Alley

Success Of Top-Tier Malls Masks Enduring Distress In Sector's Underbelly

HUD Launches Investigation Into Wells Fargo's Efforts To Support Black Homeownership

Delaware Statutory Trust Fundraising Jumps 27% From 2025

Bank OZK Shares Drop After Citi Flags $915M Mortgage Concern

Soaring Yields Strand REITs In M&A No-Man's-Land

How UK Investment Giant L&G Plans To Grow Its U.S. Multifamily Holdings

Properties Owned By REIT Accused Of Fraud To Be Auctioned Off

LS Power Raises $6B To Capitalize On Data Center Power Demand

DHS Buys 3 More Detention Facilities From The Geo Group For $950M

CRE Finance Sentiment Index Falls To 3-Year Low As Economic Fears Mount

Oprah-Backed Health Food Chain Files For Bankruptcy, Seeks To Exit Leases