April’s Apartment Rent Growth Hits Several Grim Milestones

Article originally posted on Globe St. on May 4, 2023

Apartment rents rose 1.7% in April, which is the lowest increase since March 2021 and falls below the average rate of 2.8% for 2018 to 2019, according to Apartment List’s monthly report. Month over month, national rents increased by 0.5%. Growth continues its deceleration, in other words, and Apartment List says it is likely to decline even further in the months ahead.

But perhaps what is most remarkable about last month’s rental trends was that the increase in prices was less than the typical April price change that occurred in pre-pandemic years. And Spring, lest we not forget is “ a time of year when [rent] growth is typically picking up steam.” April’s monthly growth represented a slight slowdown from the 0.6% increase we saw in March and marked the second slowest April rent growth of any year in the history of Apartment List’s rent estimates, which go back to 2017. Last month was ahead of only 2020, when prices fell in April amid the turmoil of the pandemic’s onset.

“As recession fears continue to grip many Americans, it’s likely that some households are delaying moves, translating to sluggish rental demand,” Apartment List says. “And even if demand rebounds over the summer, a robust supply of new inventory hitting the market this year will continue to keep prices in check.

“The surging rent growth that we saw in 2021 and the first half of last year is now solidly behind us.”

Location Matters 

Some cities, as they usually do, saw price increases last month; Apartment List totaled 69 of the country’s largest cities in that category, but that was down from 83 the prior month.

For example, the largest city-level increases were in New York City and neighboring Jersey City, which surprised many in recent periods. Both saw rents rise by 1.9% from March to April. Boston ranked third with a 1.8% increase. Based on such numbers, pricey Northeastern cities are rebounding.

In the Heartland or Midwest, several markets are showing fast rent growth from last year, including Cincinnati at 5.8% year-over-year, Chicago with 5.6% growth and Indianapolis at 5.4%.

Cities elsewhere, however, are not showing the same robust back-to-life activity. Those where prices have fallen include Washington, D.C., Jacksonville, Tampa, Austin and Henderson, N.V., the latter having a 5.2% drop since last April. Overall, the biggest declines are in the West, including cities of Phoenix and Las Vegas.