This week, LendingOne analysts looked at single-family rent data to better understand what investors are seeing across the nation right now.
LendingOne’s top-line findings:
- Single-family home rents continue to grow nationally year-over-year, albeit much slower than they did during the Pandemic Housing Boom. U.S. single-family rents rose 4.7% from May 2023 to May 2024.
- More affordable metros in the Midwest and Northeast are seeing the fastest single-family rent growth, indicating opportunities for increased cash flow for investors in these markets.
- Southwest Florida markets, which experienced some of the highest rent increases during the Pandemic Housing Boom, are now softening.
For this analysis, LendingOne used Zillow Observed Rent Index (ZORI) data and calculated 12-month interval rent shifts for 240 metropolitan areas.
The table below shows the single-family rent shifts in just the 50 largest markets.
LendingOne analysts found that among the 240 metros that had ZORI data for May every year from 2019 to 2024:
These 5 metros saw the biggest single-family rent growth from May 2023 to May 2024:
- Atlantic City, New Jersey: +21.2%
- Flint, Michigan: +13%
- Burlington, North Carolina: +11.7%
- Peoria, Illinois: +11.3%
- Roanoke, Virginia: +10.5%
These 5 metros saw the biggest single-family rent decline from May 2023 to May 2024:
- Lake Charles, Louisiana: −3.8%
- Punta Gorda, Florida: −2.0%
- Cape Coral, Florida: −0.9%
- Austin, Texas: −0.5%
- Crestview, Florida: −0.2%
The supply of single-family rentals in the Sun Belt has increased significantly in recent years. As this new supply, particularly build-to-rent construction in markets like Phoenix, Dallas, Orlando, and Atlanta, comes online, rent growth has softened.
Meanwhile, in Midwestern and Northeast markets like St. Louis, Cleveland, Cincinnati, Buffalo, and Milwaukee, where there is less new rental supply coming online, rent growth has not decelerated as much.
The biggest outliers right now are the Southwest Florida metros, particularly markets like Punta Gorda and Cape Coral, where they are seeing small outright year-over-year single-family rent declines. These markets have experienced a slowdown in migration following Hurricane Ian in September 2022.
Big Picture: While national single-family rent growth has decelerated significantly since the Pandemic Housing Boom, it is still rising year-over-year in most housing markets.