The average 30-year-fixed mortgage rate currently stands at 6.82%, well below the 23-year high of almost 8% hit in October, but still more than double the all-time low of 2.65% reached during the pandemic.
This has led many prospective homebuyers to delay their purchasing plans, bolstering rental demand and putting upward pressure on rents.
“Housing costs are so high that many Americans can’t afford to buy homes, but rents are also elevated, putting a lot of people searching for housing between a rock and a hard place,” the report noted.
However, the good news for renters is that rent growth has moderated significantly from the pandemic-fueled frenzy of 2022, when rents soared by as much as 17.7% year over year. Since the start of 2023, year-over-year rent growth has remained below 3%.
“During the pandemic, you saw property owners charging $2,800 a month in rent for a house that a year earlier cost $2,000,” said Heather Mahmood-Corley, a Redfin Premier real estate agent in Phoenix. “But the economy has changed, and many people are trying to curb their spending, which means it’s harder for property owners to get renters to agree to big rent hikes.”
