Declining Rents Signal Relief is on the Way for Inflation

• As rents have cooled, most major U.S. metros saw median rents pace below national inflation in the last 6 years:
  • San Francisco (-3.2%), Minneapolis, Minn. (3.9%), Oklahoma City, Okla. (7.7%), Seattle (7.9%), Denver (8.9%) and San Jose, Calif. (8.9%) saw the least growth in median rent prices since May 2019
• Federal policy shifts such as tariffs, employment reductions and international student visas are driving divergent rental trends across U.S. metros
• Median asking rents in the 50 largest metros registered at $1,705, up by $5 from last month and $54 lower than its August 2022 peak

AUSTIN, Texas, June 17, 2025 /PRNewswire/ -- While U.S. rents generally remain higher than pre-pandemic levels, their growth over the past six years has lagged behind both overall inflation and home prices, according to the Realtor.com^® May Rent Report. As of May 2025, the median rent was $1,705, up 19.6% compared to the same time in 2019—below the 25.6% rise in consumer prices. With market-based rents continuing to cool, Americans can expect further relief in shelter inflation in the months ahead.

"Falling median asking rents are an encouraging sign that relief is on the way for shelter inflation, which has been one of the largest contributors to elevated consumer prices," said Danielle Hale, chief economist at Realtor.com^®. "Because shelter costs tend to lag behind real-time market trends, the sustained slowdown in rent growth is likely to show up in the Consumer Price Index in the months ahead, helping to ease overall inflation pressure. While this is an encouraging sign, for most major U.S. metros rents are still considerably higher than before the start of the pandemic, and despite 22 consecutive months of year-over-year declines, the U.S. median rent was just $54 less than the peak seen in August 2022."

Comparing rent growth at the metro level to U.S. inflation provides important context for affordability, revealing where local housing costs are rising faster than residents' overall cost of living¹. There are just nine metro areas where rent growth has outpaced inflation since 2019: Indianapolis; Jacksonville, Fla.; Kansas City, Mo.; Miami; New York; Pittsburgh; Sacramento, Calif.; St. Louis; and Tampa, Florida.

Metros Where Rent Is Outpacing Overall Inflation Over the Past Six Years

¹ For simplicity, we used the national 25.6% rate of inflation. The Bureau of Labor Statistics produces a metro-level CPI for some, but not all, of the markets in this report. At a Census Division level, differences in CPI over the 6 years ending in May 2025 were minor, ranging from a high of 27.6% in the Mountain division of the West region, to a low of 22.0% in the New England division of the Northeast region.

Most major U.S. metros saw median rents pace below inflation. San Francisco, where rents have declined 3.2% since 2019, saw the biggest difference compared to inflation, followed by Minneapolis, Minn. (3.9%), Oklahoma City(7.7%), Seattle (7.9%), Denver (8.9%) and San Jose, Calif. (8.9%).

National Rents by Unit Size

Policy Shifts Drive Diverging Rental Trends Across U.S. Metros

Recent changes in federal policy are reshaping rental markets across the country. New restrictions on international student visas, including enrollment suspensions at schools like Harvard and a pause on new interviews are expected to reduce rental demand in international student hubs such as San Jose, Calif., Miami, Boston, Seattle and Orlando, Fla. These metros have already shown signs of cooling, with year-over-year rent declines in four of the five markets with the highest shares of international students: Miami (-2.7%), Seattle (-2.3%), Orlando, Fla. (-1.1%), and Boston (-0.4%).

Rental markets tied to federal employment are also feeling the impact of workforce changes. In cities like Washington, D.C. (1.3%), and Baltimore (0.3%), rents edged up in May 2025, while other federal hubs such as San Diego (-5.9%), Virginia Beach, Va. (-2.5%) and Oklahoma City, (-1.0%) saw rent declines. These mixed results reflect the push-pull effects of federal job cuts and return-to-office mandates, underscoring the complex role government employment plays in local housing demand.

Meanwhile, recent tariff hikes are expected to put upward pressure on future rents. Steel and aluminum tariffs, now doubled to 50%, are driving up construction costs, especially in metros like Milwaukee, Memphis, Tenn., and Columbus, Ohio, which saw a boom in multifamily permits in 2024. As of May 2025, four of these key metros saw year-over-year rent declines: Milwaukee (-0.5%), Oklahoma City (-1.0%), Cleveland (-1.9%) and Memphis, Tenn. (-3.3%). Columbus, Ohio, saw a modest 0.2% growth.  As developers face higher material costs and potential project slowdowns, affordability may come under pressure in the months ahead.

Top 50 Markets Rental Trends (Alphabetical Order)

Methodology
Rental data as of May 2025 for studio, 1-bedroom, or 2-bedroom units advertised as for-rent on Realtor.com®. Rental units include apartments as well as private rentals (condos, townhomes, single-family homes). We use rental sources that reliably report data each month within the 50 largest metropolitan areas. Realtor.com began publishing regular monthly rental trends reports in October 2020 with data history stretching back to March 2019.

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Media contact: Mallory Micetich, [email protected]

SOURCE Realtor.com