Here's where U.S. rent prices have dropped the most — and how it affects buyers

Despite wide hikes successful rental prices, contention is easing successful immoderate U.S. markets arsenic inventory grows, according to a new report from nationalist existent property brokerage HouseCanary.

At the extremity of 2022, the median U.S. rent was $2,305, which was astir 5% higher than a twelvemonth earlier. But median rents ended 2022 astir 6% little compared to the commencement of the year, the study shows.   

Although rent prices person cooled successful immoderate markets, others person continued to grow, including metros on the East Coast and done the concern Midwest, HouseCanary found.   

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These U.S. metropolitan existent property markets had the biggest year-over-year percent summation successful the median monthly single-family rental listing terms from the 2nd fractional of 2021 to the 2nd fractional of 2022. 

1. Indianapolis; Carmel, Indiana; Anderson, Indiana
Median rent astatine the extremity of 2021: $1,300
Median rent astatine the extremity of 2022: $1,700
Rent increase: 30.8%

2. Charleston, South Carolina; North Charleston, South Carolina
Median rent astatine the extremity of 2021: $2,195
Median rent astatine the extremity of 2022: $2,750
Rent increase: 25.3%

3. New Haven, Connecticut; Milford, Connecticut
Median rent astatine the extremity of 2021: $2,250
Median rent astatine the extremity of 2022: $2,800
Rent increase: 24.4%

4. Naples, Florida; Marco Island, Florida
Median rent astatine the extremity of 2021: $5,200
Median rent astatine the extremity of 2022: $6,448
Rent increase: 24.0%

5. Pittsburgh
Median rent astatine the extremity of 2021: $1,520
Median rent astatine the extremity of 2022: $1,872
Rent increase: 23.2% 

These U.S. metropolitan existent property markets had the biggest year-over-year percent alteration successful the median monthly single-family rental listing terms from the 2nd fractional of 2021 to the 2nd fractional of 2022. 

1. Memphis, Tennessee
Median rent astatine the extremity of 2021: $1,800
Median rent astatine the extremity of 2022: $1,695
Rent decrease: -5.8%

2. Port St. Lucie, Florida
Median rent astatine the extremity of 2021: $2,800
Median rent astatine the extremity of 2022: $2,650
Rent decrease: -5.4%

3. Cape Coral, Florida; Fort Myers, Florida
Median rent astatine the extremity of 2021: $4,000
Median rent astatine the extremity of 2022: $3,795
Rent decrease: -5.1%

4. Palm Bay, Florida; Melbourne, Florida; Titusville, Florida
Median rent astatine the extremity of 2021: $2,300
Median rent astatine the extremity of 2022: $2,200
Rent decrease: -4.3%

5. Phoenix; Mesa, Arizona; Chandler, Arizona
Median rent astatine the extremity of 2021: $2,350
Median rent astatine the extremity of 2022: $2,300
Rent decrease: -2.1%

As rent prices easiness and owe rates rise, it's go cheaper to rent than bargain successful galore markets. 

Renting a three-bedroom location is much affordable than owning a comparable median-priced spot successful astir of the country, according to a recent report from Attom, a existent property information investigation firm. 

Similarly, Realtor.com's December rental report published Thursday recovered the U.S. median rental price, $1,712, was astir $800 cheaper than the monthly outgo for a starter home.   

"It's a beauteous melodramatic shift," said Rick Sharga, enforcement vice president of marketplace quality astatine Attom, pointing to 1 twelvemonth agone erstwhile it was cheaper to bargain than rent successful 60% of the markets Attom analyzed. "You simply can't overstate the interaction that higher financing costs person had connected homeownership." 

While owe involvement rates person recently cooled, rates much than doubled successful 2022, which has ne'er happened successful 1 year, according to Freddie Mac. In January 2022, the mean 30-year fixed complaint owe was astir 3% earlier jumping to implicit 7% successful October and November.

Sharga said the owe complaint summation made monthly owe payments 45% to 50% higher for a location purchase, adjacent arsenic home terms appreciation slowed. "That astir apt is the azygous biggest origin successful creating that shift," helium added.

While conditions for homebuyers whitethorn beryllium somewhat much favorable successful 2023, it's hard to foretell whether the economy is heading for a recession, which whitethorn displacement fiscal priorities, experts say.

"One happening to ever support successful caput is that markets are perpetually changing," said Keith Gumbinger, vice president of owe website HSH. "If you don't request to beryllium successful this marketplace close now, you're astir apt amended to clasp disconnected and ticker conditions change."

Of course, there's much to home-buying decisions than location prices and owe involvement rates. "The determination connected whether to rent oregon bargain is ever a substance of timing," helium said. "And much importantly, it's a substance of need."