Annual single-family rent growth held steady at a 3% pace nationwide in April, easing as unemployment hits an 80-year high and stay-in-place mandates continued to keep people from finding new apartments.
After three straight months of acceleration, the CoreLogic Single-Family Rent Index (SFRI) showed a 3% dip in annual rent price growth during the onset of the coronavirus outbreak in the second half of March. During this period, rental applications plummeted 44%, causing a slowdown in demand.
However, effects of the pandemic vary across price tiers, according to CoreLogic Principal Economist Molly Boesel.
"Lower-priced rentals experienced a slight uptick in March as renters pursued more affordable rental options," Boesel said. "Employment gains turned negative in four of the 20 metropolitan areas analyzed in the CoreLogic SFRI, a trend we can soon expect to see across the nation, which should have an impact on single-family rent prices.”
Lower-priced rentals propped up the rental market in March. Rent prices among the low-end tier (properties with rent less than 75% of the regional median) rose 3.9% year over year in March, up from 3.7% a year ago. Meanwhile, higher-priced rentals (those with rent prices greater than 125% of a region's median rent) increased at a 2.7% pace in March, unchanged from last year.
Phoenix, with limited new construction, low rental vacancies, and robust local economy, had the highest annual increase in single-family rents in March at 6.8%. Seattle and Tucson followed with gains of 6.2% and 5.3%, respectively. Among the 20 metro areas analyzed, Honolulu saw the smallest increase at 0.7%.