The nationwide median rent edged upwards this month, reversing a trend

Another data point on the inflation front that’s not great for consumers: Rents edged up nationwide this month, according to rental marketplace Zumper.

It wasn’t a big jump — 0.2% in March for one-bedrooms, 0.1% for two-bedrooms. But it still reverses the trend over the past year or so, when Zumper’s national rent index was falling month after month, led by rent deflation in regions like the South and West.

Let’s start with where rents are up sharply: dense coastal cities where there’s not much new housing supply or room to build, per Zumper’s Crystal Chen.

“Like San Francisco, rents are hitting all-time highs,” she said — $3,790 a month for a typical one-bedroom apartment.

Tech stocks might be struggling, but as a driver of the rental market, tech is riding high. “AI-related hiring bringing high-income renters back, stronger return-to-office expectations bringing people to city centers,” Chen noted.

Rents are still down sharply in the Sunbelt, from Florida to Texas and Arizona, where a wave of migration after the pandemic led to a lot of new apartments getting built and flooding the market.

Going forward, Robert Dietz at the National Association of Home Builders expects more multifamily housing “in lower-density markets, secondary and tertiary cities — places like the Carolinas; Columbus, Ohio; Indianapolis.”

Rental demand is likely to stay strong because buying a house is so unaffordable.

“And that means some people are going to rent longer, particularly those younger households,” Dietz said — those ones who are worried about the stagnant job market and getting saddled with a mortgage payment they can’t afford.