Renters who desire more space as they ride out the pandemic are increasingly looking to upsize into single-family homes. Since the COVID-19 pandemic began, single-family rental prices have for the first time outpaced their pre-pandemic growth rate.
National rent increases for single-family rental homes increased 3.1% year over year in October, according to CoreLogic’s latest reading, published in its new Single-Family Rent Index.
This spring and summer, overall rental prices slowed. But Americans who needed or preferred to rent looked to single-family homes due to their larger sizes, separate spaces, and outdoor areas. The supply of single-family rentals has been quickly declined as demand has surged.
Higher-tier single-family rentals saw a particular surge in interest from potential tenants.
“Demand has grown for higher-tier single-family rentals as more people opt to rent larger spaces in less densely populated areas,” says Molly Boesel, principal economist at CoreLogic. “Rent growth of lower-tier rentals still lags behind pre-pandemic rates, which is to be expected in an economy particularly challenging for low-wage earners.”
The price of lower-priced rentals—75% or less than each regional median price—was down 3.6% compared to a year ago. Meanwhile, the higher-middle tier—100% to 125% of each region’s median value—is up 2.6% from a year ago, while the highest-priced tier—125% or more than the regional value—is up 2.7% compared to last year.
Among the 20 metro areas tracked, Phoenix had the highest year-over-year increase in single-family rental prices in October at 8.9%, followed by Tucson, Ariz., with a 7.6% gain, and Charlotte, N.C., at 5.2%.
Source: CoreLogic
