Rents Are Finally Falling — Here Are the Cities With the Biggest Drops

Renters may finally be getting a break.

The median asking rent across all bedroom counts fell year-over-year in July — the first time that’s happened since the the peak of the COVID-19 pandemic back in June 2020, according to real estate company Redfin.

The median asking rate for three-or-more bedroom apartments declined the most since last July, dropping 2.4% to $2,010. That’s largely due to an increase in supply, Redfin reports. Rent prices for smaller apartments were more steady over the past year, as the median asking rate for rentals with one bedroom fell 0.1% to $1,498 a month and the rate for two-bedroom apartments dipped 0.3% to $1,730.

That doesn't mean renters have it easy, though. Harvard researchers recently found that in 2022, half of U.S. renters were putting at least 30% of their income toward housing costs, which is a record high. While rent prices have been outpacing wages for decades, the trend was exacerbated by the pandemic: Rent prices are 26% higher than they were in early 2020, the researchers found.

Despite the extreme lack of affordable housing, Redfin’s data signals that renting in some areas may be getting easier.

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Cities where rental prices are falling the most

If you're looking to save on rent, it may be time to head to the Sun Belt states. Redfin analyzed 33 major U.S. metropolitan areas and the following five had the biggest drops in asking rents in July compared to a year ago:

1. Austin, Texas (down 16.9%)
2. Jacksonville, Florida (down 14.3%)
3. San Diego, California (down 12.7%),
4. San Francisco, California (down (7.6%)
5. Tampa, Florida (down 5.9%)

While renters in some places are snatching up cheaper rents, that’s not the case everywhere: The nationwide median asking rent actually rose slightly (0.4%) year-over-year in July to $1,647. But it was down 0.2% from June of this year, and it’s still $53 below August 2022’s all-time high.

“Rents have recently steadied — or even dropped slightly — because of the sheer number of apartments built over the past two years,” Sheharyar Bokhari, senior economist at Redfin, said in the press release accompanying the report. “Construction is slowing down and prices will eventually start rising again, but now is still a good time for renters to find a deal, especially families looking for an apartment with at least three bedrooms.”

Renters are snagging concessions

The (slight) drop in asking rents isn’t the only bright spot for renters. More property managers are offering “concessions” like free weeks of rent or parking to sweeten lease deals, according to a separate report released this week by real estate company Zillow.

The share of rental listings with these offerings jumped last fall and the trend has stuck in the months since. Zillow found that 33.2% of rental listings on its site offered a concession in July, up from 25.4% last year — a result of a slowdown in rent growth that property managers felt the need to respond to.

Of course, your odds of signing a lease with a bonus deal depends on where you live. About half of rental listings in some cities, like Atlanta and Salt Lake City, include concessions. But in other major metros, such as Baltimore and Milwaukee, there are fewer concessions than this time last year.

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