The latest Top 100 U.S. Metropolitan Statistical Area (MSA) Rental Market Report from the Alabama Center for Real Estate (ACRE) at The University of Alabama indicates that apartment rents continue to increase nationwide, although the national market remains modestly below its long-run trend.
The national median asking rent reached $1,950.87 per month, while ACRE’s forecasting model estimates an equilibrium rent of $1,978.23, placing the national market 1.38% below its long-run trend. Despite this modest gap, rental prices continue to appreciate, increasing 0.50% over the past month and 2.03% over the past year.
“National rental markets continue to demonstrate resilience despite elevated housing costs and economic uncertainty,” said Dr. Bennie D. Waller, William Cary Hulsey Fellow and Research Associate with the Alabama Center for Real Estate. “Although rents remain slightly below where long-term fundamentals suggest they should be, steady year-over-year growth indicates that demand for rental housing remains healthy across much of the country.”
Markets with the Strongest Relative Rental Premiums
Several metropolitan areas currently exhibit rents that exceed their long-run predicted values, suggesting relatively tight rental conditions:
|
Metropolitan Area
|
Actual Rent
|
Above Predicted
|
|---|---|---|
|
Chicago, IL
|
$2,266
|
+6.20%
|
|
San Francisco, CA
|
$3,258
|
+5.78%
|
|
San Jose, CA
|
$3,625
|
+5.01%
|
|
New York, NY
|
$3,503
|
+4.82%
|
|
Urban Honolulu, HI
|
$2,980
|
+4.60%
|
These markets continue to experience strong demand supported by limited housing supply and robust labor markets.
Markets Trading Below Long-Run Trend
Conversely, several markets remain well below their predicted rental values:
|
Metropolitan Area
|
Actual Rent
|
Below Predicted
|
|---|---|---|
|
Cape Coral, FL
|
$1,881
|
−10.68%
|
|
Austin, TX
|
$1,635
|
−9.45%
|
|
North Port, FL
|
$2,154
|
−9.22%
|
|
Phoenix, AZ
|
$1,742
|
−9.03%
|
|
San Antonio, TX
|
$1,404
|
−6.65%
|
Many Sun Belt markets continue adjusting following rapid post-pandemic construction and slower population growth than experienced during 2021–2023.
National Trends
National rent growth has remained positive across every reported time horizon:
-
1 Month: +0.50%
-
3 Months: +1.63%
-
6 Months: +1.83%
-
9 Months: +1.39%
-
12 Months: +2.03%
These results suggest the rental market continues to normalize while avoiding significant nationwide declines.
“The rental market is transitioning from the exceptionally rapid appreciation experienced during the pandemic toward a more sustainable pace of growth,” Waller said. “Rather than indicating weakness, today’s data reflect a healthier balance between housing supply and rental demand.”
The report is based on rental data for the nation’s 100 largest metropolitan statistical areas and compares current asking rents with ACRE’s long-run equilibrium rental model to identify markets that appear relatively over- or under-valued.
