The single-family rental (SFR) market is undergoing significant shifts, with coastal metros now outpacing the Sun Belt in rent growth. CoreLogic’s latest report highlights these trends, offering valuable insights for real estate developers and investors seeking new opportunities.
Steady as She Goes
SFR rent growth slowed to 2.4% year-over-year (YoY) — the lowest increase since fall 2023. Monthly rent growth also lagged, rising just 0.2% compared to the usual 0.3%. Despite this slowdown, SFR rents have still climbed by a third since the start of the pandemic.
Detailed Market Analysis
CoreLogic categorizes SFRs into two main groups: attached and detached units, and four price tiers ranging from lower-priced to higher-priced rentals. Key findings include:
- Detached SFRs: Experienced a 2.3% increase in rents.
- Attached SFRs: Saw a 2% rent growth.
- Higher-Priced Rentals: Led growth with a 2.9% increase.
- Lower-Priced Rentals: Decreased by 0.2%.
Multifamily Supply Dynamics
The pandemic-era multifamily boom, driven by significant investor capital, has cooled. Excess supply is pushing vacancies and depressing rents in major cities. This makes the steady SFR growth more notable, despite higher maintenance costs for dispersed single-family properties compared to centralized multifamily buildings.
Winners and Losers
Among the 20 largest metros analyzed, seven recorded rent growth above 4%, with median rents exceeding $3,000. Leading markets include:
- Seattle: 5.8% growth, $3,507 median rent.
- New York City: 5.5%, $3,346 median rent.
- Washington, D.C.: 5.5%, $3,140 median rent.
Meanwhile, Sun Belt cities like Austin (-2.3%, $2,180) and Phoenix (0%, $2,442) showed minimal or negative growth, reflecting a broader cooling trend.
Coastal markets are driving SFR rent growth, while Sun Belt metros, which experienced rapid rises over the past four years, are seeing slower momentum. As multifamily markets grapple with oversupply, single-family rentals may be an appealing alternative — particularly in higher-priced coastal regions.
Join the Conversation: What are your thoughts on the shifting dynamics in the SFR market? How do you see these trends impacting real estate investments? Share your insights and engage with our community!
What are your views on the evolving single-family rental market? Let’s discuss below! 💬🏡