- Nationally, rent growth continues to exceed pre-pandemic rates as unemployment falls
- Low-end rental prices were up 3.2% in March, compared to high-end price gains of 5%
CoreLogic® (NYSE: CLGX), a leading global property information, analytics and data-enabled solutions provider, today released its latest Single-Family Rent Index (SFRI), which analyzes single-family rent price changes nationally and across major metropolitan areas.
According to the U.S. Census, the occupancy rates for single-family rentals is at a generational high, which is driving up inventory pressure and, subsequently, rent growth. A recent CoreLogic survey shows that nearly 70% of consumers agree high prices for homes are causing many people to rent. However, as demand continues to drive rent prices higher, we may expect to see growing affordability challenges on the rental front as well, as 36% of consumers already feel rental options in their neighborhood are not very or not-at-all affordable.
“The CoreLogic Single-Family Rent Index shows a preference shift to standalone properties as renters seek more space in less dense areas,” said Molly Boesel, principal economist at CoreLogic. “Prior to the pandemic, rents for detached properties and attached properties grew at similar rates. However, starting in June 2020, rent growth for detached properties accelerated and by March, grew at five times the rent growth rate of attached properties.”
To gain a detailed view of single-family rental prices, CoreLogic examines four tiers of rental prices. National single-family rent growth across the four tiers, and the year-over-year changes, were as follows:
- Lower-priced (75% or less than the regional median): 3.2%, down from 3.8% in March 2020
- Lower-middle priced (75% to 100% of the regional median): 3.7%, up from 3.1% in March 2020
- Higher-middle priced (100% to 125% of the regional median): 4.2%, up from 2.9% in March 2020
- Higher-priced (125% or more than the regional median): 5%, up from 2.8% in March 2020
Among the 20 metro areas shown in Table 1, Phoenix had the highest year-over-year increase in single-family rents in March 2021 at 11.4%. Tucson, Arizona, had the second-highest rent price growth with a gain of 10.4%. Atlanta, which had the second-lowest unemployment rate in March among the 20 metro areas, had the third highest year-over-year rent growth of 8.1% as job stability returns and families seek more space. Conversely, Boston had an annual decline of 7.7% in rent prices and has experienced the largest decrease in 20 metros’ rent prices for eight consecutive months.
The single-family rental market accounts for half of the rental housing stock, yet unlike the multifamily market, which has many different sources of rent data, there are minimal quality adjusted single-family rent transaction data. The CoreLogic Single-Family Rent Index (SFRI) serves to fill that void by applying a repeat pairing methodology to single-family rental listing data in the Multiple Listing Service. CoreLogic constructed the SFRI for over 80 metropolitan areas — including 45 metros with four value tiers — and a national composite index.
The CoreLogic Single-Family Rent Index analyzes data across four price tiers: Lower-priced, which represent rentals with prices 75% or below the regional median; lower-middle, 75% to 100% of the regional median; higher-middle, 100%-125% of the regional median; and higher-priced, 125% or more above the regional median.
Median rent price data is produced monthly by CoreLogic RentalTrends. RentalTrends is built on a database of more than 11 million rental properties (over 75% of all U.S. individual owned rental properties) and covers all 50 states and 17,500 ZIP codes.
About the CoreLogic Consumer Housing Sentiment Study
3,000+ consumers were surveyed by CoreLogic via Qualtrics. The study is an annual pulse of U.S. housing market dynamics concentrated on consumers looking to purchase a home, consumers not looking to purchase a home, and current mortgage holder. The survey was conducted in April 2021 and hosted on Qualtrics.
The survey has a sampling error of ~3% at the total respondent level with a 95% confidence level.
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