Renters in the United States could soon see some relief as a recent construction boom brought asking prices lower and pushed more landlords to offer benefits.
In June, approximately 60,000 multifamily units were completed nationwide. That is more than any month in the past 50 years, according to a new report from online real estate marketplace Zillow. This construction boom means there is now more supply on the market for renters, which could lead to falling prices.
"Now is a great time for renters to find a deal, with more new apartments hitting the market than at any time in the past several decades. Rents are still growing, but it's a far cry from the steep rent hikes of two or three years ago, and renters will find sweeteners being offered by more than half of rentals in some places," Zillow Chief Economist Skylar Olsen said in a blog post.
"A slowing job market and lower mortgage rates could mean falling rents if the current trends hold," Olsen added.
The median asking rent price for a studio or one-bedroom apartment has already fallen 0.1% to $1,498 a month. Rents for two-bedroom apartments and units with three bedrooms or more also fell to $1,730 and $2,010 a month, respectively, per Redfin data.
More Landlords Are Now Offering Rental Perks
With the supply in the market increasing, more landlords are willing to offer concessions to tenants, including parking privileges and weeks of free rent. Nationwide, 33.2% of rental listings on Zillow offered tenants a concession in July. That is up from 25.4% in the same month last year.
Among metro areas, there were six where more than half of all rental listings on Zillow offered concessions, including Raleigh (53.3%), Charlotte (53.1%), Atlanta (52.2%), Salt Lake City (50.9%), Nashville (50.8%), and Austin (50.5%).
In contrast, four major metro areas had falling shares of landlords offering concessions, including San Jose (-9.7%), Baltimore (-5.6%), Milwaukee (-1.8%), and Pittsburg (-0.2%).
As of the second quarter of 2024, the rental vacancy rate remained at 6.6%. This is the fourth quarter that the vacancy rate has held steady at 6.6%.
