Single-Family Rent Commands 40% of Residents’ Income
Lower-income tenants bearing much of the brunt of inflation, CoreLogic said.
More than three years of substantial rent increases have had a lasting impact on tenants’ budgets, according to CoreLogic’s latest Single-Family Rent Index (SFRI), which analyzes single-family rent price changes nationally and across major metropolitan areas.
The average American renter household spends about 40% of its income on housing costs, with lower-income tenants bearing much of the brunt of inflation, the report said.
The SFRI’s low tier saw the largest year-over-year rental cost gain in August (up by 4.2%), while the high tier registered a 2.4% annual increase, despite annual US single-family rent growth easing again in August.
Molly Boesel, principal economist for CoreLogic, said in prepared remarks, “While annual single-family rent growth has returned to a moderate pace, … single-family rents grew by 30% since February 2020, and small drops in some areas barely put a dent in the overall, cumulative increase.”
For example, Boesel said, that even though rents in the Miami metro area have declined by 0.5% since August 2022, they are still 51% higher than they were before the pandemic began.
Attached single-family rental prices grew by 3.5% year over year in August, compared with the 2.3% increase for detached rentals.
St. Louis posted the highest year-over-year increase in single-family rents in August 2023, at 7%. Chicago was next at 5.7%, followed by Boston and San Diego (both 5.6%). Austin (-0.9%), Las Vegas (-0.8%), and Miami (-0.5%) saw modest year-over-year rental cost decreases.