Dec 15, 2022 - Economy

U.S. rents drop at the fastest rate in 7 years, per Zillow

Data: Zillow; Note: Typical rent is the average rent of the middle 30% of units; Chart: Axios Visuals

Rent prices fell 0.4% in November — the largest month-over-month drop since Zillow started tracking this data in 2015, according to the real estate company’s latest rent report.

Why it matters: This is another sign that inflation is easing.

  • Month-over-month prices are falling fastest in Raleigh (-1.3%), Austin (-1.2%), and Seattle (-1.1%).

The big picture: The rent got too damn high. Fewer folks could afford to pay these prices, particularly when the cost of everything else was going up, too.

  • Now more people are "doubling up with roommates or family," instead of striking out on their own, Zillow reports.
  • Rents are still way higher than before the pandemic, at a national average of $2,008 per month.

What we're watching: The recent declines will take time to filter into the government's Consumer Price Index numbers because of the way rent is measured in that report.

  • Fed chair Jerome Powell acknowledged this at his press conference Wednesday, noting that inflation readings for rent will likely "come down sometime next year."
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