Single-family rental homes once boasted high rent growth due to expanding demand. But things have changed, as national SFR rent growth fell year-over-year in late 2024, according to three reports.

“Single-family annual rent growth slowed in November to the lowest rate in about 14 years,” CoreLogic Senior Principal Economist Molly Boesel said in a press release.

The information from CoreLogic, Rentometer and Yardi Matrix also demonstrated that rent growth (or lack thereof) varied by region. Many Sun Belt cities experienced a decline in rent growth, while Midwest metros reported year-over-year increases.

Breaking it Down

Nationally, CoreLogic reported 1.5% year-over-year rent growth for November 2024. Meanwhile, Rentometer and Yardi Matrix indicated a negative 0.8% YoY rent growth as of December 2024. Average rents were $2,357 (Rentometer) and $2,141 (Yardi Matrix).

The reports also noted the following:

• YoY rent growth in Kansas City, Grand Rapids, MI and Columbus, OH, ranged from 2.5% to just under 6.0% according to Yardi Matrix. CoreLogic said that Detroit had the highest YoY rent growth, at 6.1%.

• Multiple cities in Texas experienced negative rent growth, including Austin (-4.3%), Plano (-3.1%) and San Antonio (-2.5%), Rentometer said. Yardi Matrix also reported negative rent growth in Dallas-Fort Worth and Austin.

• Yardi Matrix and Rentometer said that other Sun Belt metros—Phoenix, Pensacola, FL and Tampa, FL—reported negative rent growth.

• Meanwhile, Yardi Matrix reported that occupancy was 95.0%, while Rentometer said the vacancy rate was 6.0% (94% occupancy).

Understanding the Reasons

The main reason for the regional variations in rent growth is because of supply. “The Sun Belt, which accounts for most of the build-to-rent developments, is home to many of the cities experiencing annual rent declines,” Rentometer analysts said.

Seasonal factors are also involved with rent growth. “Fewer people move during the winter months, leading to decreased demand for rentals,” Yardi Matrix’s Business Intelligence Manager Doug Ressler told Connect CRE in a recent interview. “This is why the rental market often experiences a slowdown in the fourth quarter.”

Then there are macroeconomic conditions—think interest rate fluctuations and inflation—which can impact an ability to afford higher rents. “This uncertainty can lead to slower rent growth as landlords adjust to maintain occupancy,” Ressler observed.

The Outlook

Though SFR rent growth slumped during the latter part of 2024, don’t expect this trend to continue. “With new deliveries expected to decline in the coming year compared to the previous two years, this could lead to renewed price increases,” Rentometer analysts said.

Additionally, demand for SFRs is likely to be robust moving forward. “Despite the recent slowdown in rent growth, demand for rentals should remain strong, as wage and job growth are expected to remain strong this year,” CoreLogic’s Boesel added.