Due to low rental home inventory, single-family rental prices continued to rise throughout 2019. And the increases were not limited to one class of property either.
Low-end rent prices went up 3.6%, while high-end price gains rose 2.9%, according to CoreLogic’s Single-Family Rent Index.
“Increases in low-end rent prices have outpaced those on the high end for more than five years as newly-formed households push up demand for entry-level rentals,” said Molly Boesel, principal economist at CoreLogic.
October saw a national rent increase of 3.1%, compared to the 2.9% increase in October 2018.
According to the report, overall year over year rent price increases have slowed since February 2016, despite a constant climb throughout the decade.
Rent price increases peaked at 4% in February 2016, but stabilized not until early 2019 at around 3%.
October was the 66th consecutive month that low-end rentals saw national rent growth.
Phoenix was the market that saw the highest uptick in rent, with the highest year over year increase in single-family rents at 6.8% in October.
Many other markets hovered around 2% on average.
“High-end rents gained momentum for the sixth consecutive month in October 2019, while low-end rates slowed for the first time in roughly five months – resulting in the narrowest gap in rent growth for these price tiers since 2014,” Boesel continued.
Miami had the lowest amount of rent increase, at 1%, the same amount of increase it saw in September.
CoreLogic said that metros with limited new construction, low rental vacancies and a strong local economy attract new employees, leading to stronger rent growth.