Wages are finally outperforming rents and by a wide margin. The trend is expected to continue in the immediate future, according to Jay Parsons, Chief Economist of RealPage, who also authored this recent report. 

Year-over-year wage growth in the country topped effective apartment rent growth for nine consecutive months; specifically, through August of this year they topped rents 5.3% to 0.3%. The income data comes from the Federal Reserve Bank of Atlanta's Wage Growth Tracker while the rent data covers effective asking rents for market-rate apartments, which RealPage tracks. Real average hourly earnings are up 1.2% in the last 12 months ended in June, according to the Labor Department.

Why the change? The rent growth is decreasing due to a big uptick in new apartment construction, which Parsons said, has hit an "historic surge." Part of that was due to low occupancy during 2021 when the pandemic was at its peak, high-rent growth and low interest rates, all leading to a significant apartment construction wave. In fact, it surpassed a 50-year high. During the nineteen months in 2021-22, rents grew cumulatively almost twice as fast as wages.