Inventory outpaces demand, dragging rents lower while buyer-side costs remain elevated
The median US asking rent fell by 1% year over year to $1,625 in April, the biggest drop in 14 months, according to a new report from Redfin.
The decline marks a continuation of the trend of subdued rent movement, with April being the 14th consecutive month in which year-over-year changes in asking rents remained within a narrow ±1% range.
While the April decline brings the median rent $80 below its August 2022 peak of $1,705, rents increased 1.2% month over month, typical seasonal behavior as spring leasing picks up.
“Asking rents are sluggish because there are more apartments for rent than people who want to rent them,” Redfin senior economist Sheharyar Bokhari said. “Renter demand is strong, but growth in apartment supply is even stronger because multifamily construction surged in the wake of the pandemic moving frenzy.”
Oversupply eases rents
The recent rent softness is driven largely by an oversupply in the multifamily market.
The rental vacancy rate for buildings with five or more units was 8.2% in Q1 2025, tying the previous quarter for the highest rate since early 2021. Less than half of newly built apartments are being rented within three months, a record low share.
Though permits for new multifamily buildings are now tapering off, the existing supply overhang is expected to continue suppressing rent growth in the near term. Bokhari added that asking rents could rebound in the coming months as the pace of new supply slows and demand continues to recover.
Read next: Multifamily mortgage debt growth outpaces commercial real estate
Despite this recent dip, rent prices remain largely stable when compared to the extreme volatility of the pandemic period, during which rents surged by as much as 17.7% and fell by as much as 4.1% year over year.
Stunted Spring homebuying season
In a separate Redfin report, the median monthly housing payment hit a record $2,868 for the four weeks ending May 4. The combination of home prices up 1.8% year over year and a weekly average mortgage rate of 6.76%, still far above pandemic-era lows, has pushed affordability out of reach for many would-be buyers.
These record costs and broader economic unease are weighing heavily on the housing market. While mortgage-purchase applications did increase last week, they remain 6% lower month over month, and pending home sales are down 3.9% year over year, the steepest decline in three months.
Nicole Stewart, a Redfin Premier agent in Boise, ID, described a buyer pool divided between those holding out for lower rates and those seeking only turnkey homes.
“April is typically a busy month, but spring is off to a slow start this year,” she said. “There are still some prospective buyers who believe mortgage rates will fall soon, and they’re waiting for that to happen.”
Those buyers who are active are being more selective and negotiating harder, especially when homes need work. In contrast, move-in-ready homes in desirable neighborhoods are still seeing multiple offers and competitive activity.
New listings rose 5.5% year over year, and the total number of homes for sale jumped 13.6%, driven in part by the slowdown in sales.
Stay updated with the freshest mortgage news. Get exclusive interviews, breaking news, and industry events in your inbox, and always be the first to know by subscribing to our FREE daily newsletter.
