The February Rental Report by Realtor.com reveals that while inflation has started to decrease, renting a home is still a major challenge for many Americans. In 26 major metros that were analyzed, affordability continued to decline, despite a slight decrease in rent prices.
Despite a slight decrease in median rent prices for the 50 largest metros in February 2023, with a drop of $1 from the previous month and $48 from the peak, it is still 3.1% higher compared to the same time last year. As a result, the rental payments have become less affordable, with renters using 25.3% of their typical household income to lease a typical for-rent home, as opposed to 24.8% in the previous year.
Although rent growth has been slowing down for the past 13 months and has experienced single-digit growth for the past seven months, rental prices are still significantly higher than the pre-pandemic levels. Rent prices in February 2023 were $296 (20.8%) higher than the same time in 2020.
In February 2023, rent was less affordable than the previous year, with eight of the top 50 metros having a rent share higher than 30% relative to the median household income. Miami was the least affordable rental market, with the median rent for a typical 0-2 bedroom unit being 1.4 times higher than the estimated maximum affordable rent for the median household.
Meanwhile, Oklahoma City, OK, emerged as the most economical rental market, as the median rent for a standard 0-2 bedroom apartment constituted just 58% of its projected maximum affordable rent.
In February 2023, the U.S. rental market experienced single-digit growth for the seventh consecutive month, with the median rent across the top 50 metros being up by just 3.1% year-over-year for 0-2 bedroom properties. The median asking rent was $1,716, down by $1 from the previous month and $48 from the peak. However, it still remains significantly higher than the pre-pandemic levels.