The rental market seems to be returning to normal after years of unprecedented growth. A national Yardi survey reveals prices cooled in hot markets across the country in October.

“What we see inside the data nationally is an expected deceleration of rent growth, especially in heavily supply impacted markets, such as San Francisco and Denver,” Yardi Matrix VP Jeff Adler tells Bisnow.

Monthly average rents fell by $3 in the country to $1,216,  the largest drop since October 2013. The report goes on to underscore that the deceleration is not a sign that the sector is set for a correction. A strong labor market, growing population and encouraging occupancy figures indicate strength in the rental space.

Mid-priced apartments performed well as new supply has focused on the high-end luxury segment. Class-B buildings have seen healthy growth in both occupancy and rent growth as Millennials continue to drive demand.

Regionally, rent growth in certain markets remains strong.  “Many Southern and Western markets remain quite high (>6%),” Adler said.

Sacramento led the pack with a 12.1% year-over-year growth. Inland Empire, San Diago, Orange Country and Portland rounded out the top five, each registering above 6% growth.

In contrast, the NYC metro areas (such as Manhattan) remains essentially flat, posting a 3% to 4% increase in rent.

Energy-centric markets like Houston continue to suffer. A plunge in oil prices has significantly softened the market in the Texas city. “Its loss of energy-sector jobs and heavy supply growth put it last [in rankings],” the report notes.