“Mortgage rates ticked back up in February—a disappointing development for prospective homebuyers, who just a few months ago got a glimmer of hope as rates finally started to fall,” Fairweather said. “With rates still elevated, many are opting to continue renting, which is buoying rental demand, and as a result, rent prices.”
However, there’s potential for change later this year. The Federal Reserve may lower interest rates, making homeownership more attractive and possibly causing a dip in rental prices.
February’s numbers, while indicating a rise, are comparatively stable against the extreme fluctuations of the past two years. Pandemic-driven market shifts caused rents to surge before significantly slowing in 2022 and even declining year-over-year in 2023.
Despite the recent stabilization, renters face affordability challenges. The current median rent is still 24.3% higher than in February 2020, just before the pandemic.
Regional differences in rents
Rent increases varied across the US. The Northeast saw the most significant jump, with a 5.2% yearly increase to $2,481 – the largest gain in nine months.
Source: mpamag.com