Apartment rents are continuing their decline as a half-million new units are getting set to hit the market this year.

Apartment renters paid 3.5% less for new units in January than they did in August, marking the sixth consecutive month of falling rents, according to Apartment List data reported by The Wall Street Journal.

The trend is a reversal after the pandemic caused rents across the country to spike by over 20%. And some of the recently soaring markets saw the biggest declines: Seattle rents have fallen by 8%, and rents in Boston and Las Vegas are down 6% since the summer, the WSJ reported.

Landlords could deliver as many as 565,000 new apartments in the U.S. this year, according to Berkadia, creating an even more competitive environment for landlords as demand falls.

Apartment renters absorbed 15,600 units in the fourth quarter, down from 52,800 in the third quarter, according to CBRE. A wave of new construction helped push the overall vacancy rate to 4.6%, nearly double what it was in the first quarter of 2022.

While competition and inflation have stopped apartment rent growth in its tracks, there is little chance that rents could return to their pre-pandemic levels. In Sun Belt cities like Miami and Tampa, Florida, and Tucson, Arizona, rents are still 35% higher than they were in March 2020, per Apartment List.

There is also likely to be less competition from the for-sale market, keeping renters in rental units.

The number of for-rent housing units that started construction outpaced the number of for-sale single-family housing starts for the first time ever in the fourth quarter of last year, according to the Census Bureau's latest housing report. Single-family houses intended for sale nationwide totaled 132,000 starts between September and December, down 34% year-over-year.