National apartment rents are showing signs of renewed growth, but the story varies dramatically by market.
According to the latest National Rent Report from rental marketplace Zumper, median asking rents for U.S. one-bedroom apartments rose 0.5% in June from May to $1,526 a month. Median two-bedroom rents increased 0.1% to $1,905 monthly.
More significantly, one-bedroom rents posted their first annual increase in more than a year, rising 0.4% from June of last year. Two-bedroom rents remained nearly flat, down just 0.3% on an annual basis.
The report suggests that the national apartment market is stabilizing after nearly a year of softening rents. Annual declines in one-bedroom rents have eased steadily for six consecutive months, improving from a 2.2% year-over-year drop last November to positive territory this June.
Supply remains the key factor driving rent performance, according to Zumper. Markets that continue to deliver large numbers of new apartment units are generally seeing softer rents, though declines are moderating. Markets with limited inventory, meanwhile, are experiencing stronger rent growth.
No market better illustrates that trend than San Francisco. The city posted record-high rents for both one-bedroom and two-bedroom apartments in June, with median asking rents reaching $4,060 and $5,700, respectively. San Francisco also led the nation in annual rent growth, with rents climbing by about 22% for both apartment types. Nearby Bay Area cities also posted gains, with one-bedroom rents in Oakland increasing 6.2% annually and those in San Jose rising 2.6%.
At the other end of the spectrum, many markets in Arizona continued to report annual rent declines. Nearly every major market in the Phoenix area saw lower one-bedroom rents compared to a year earlier, highlighting the impact that new supply can have on pricing.
Among the nation’s most expensive rental markets, New York City retained the top spot with median one-bedroom rents of $4,660 a month, though that figure slipped slightly from the previous month’s all-time high. San Francisco remained a close second.
The latest figures indicate that while rent growth is returning nationally, apartment fundamentals remain highly localized. Markets with constrained supply continue to push rents higher, while areas with abundant new development are giving renters more options and helping keep pricing in check.
