An Expanding Supply of Rentals Keeps Rent Growth in Check (February Rental Report)
- The year-over-year increase in the typical U.S. asking rent eased to 1.9% in February, according to the Zillow Observed Rent Index.
- Nearly 40% of rental listings on Zillow offered concessions, such as free rent or waived fees, in February.
- While affordability is improving, a household needs to earn about $76,000 a year to afford the typical rent — nearly $20,000 more than before the pandemic.
The rental market is recalibrating following years of rapid growth. In February, rents nationwide were up 1.9% from a year earlier. This is the slowest pace of annual growth since December 2020. The typical asking rent now stands at $1,895, according to the Zillow Observed Rent Index (ZORI).
The moderation is being driven by expanding supply. A boom in apartment construction has pushed vacancy rates higher and slowed multifamily rent growth to 1.4% annually, down from nearly 16% at the height of the 2022 rental frenzy.
Cooling conditions in the for-sale market are also contributing to rental supply. Late last year, a near-record number of homeowners who were unable to sell chose to rent out their properties instead. These “accidental landlords” are adding single-family homes to the rental pool. Single-family rents rose 2.6% year over year in February, the slowest annual growth in Zillow’s records dating back to 2015. For comparison, single-family rent growth averaged about 4.4% annually before the pandemic.
Renters are gaining leverage as new supply comes online, and that dynamic is expected to continue. As apartment construction expands and more single-family homes enter the rental market, property managers are increasingly competing on price and incentives.
Affordability improves, but pressures persist
As incomes have grown slightly faster than rents over the past year, affordability for new renters has modestly improved. A renter household that earns the median household income now spends 26.3% of its income on rent, down slightly from a year ago. Still, a household needs to earn about $76,000 annually to comfortably afford the typical rental, which is 35% higher than the income required before the pandemic.
The good news for renters: More rental options have boosted bargaining power and helped cool rent growth. Concessions remain common as well, with 39.2% of listings on Zillow offering incentives, such as free rent or waived fees. While that share is down slightly from a year ago, it remains elevated by historical standards.
Local markets move at different speeds
In February, the pace of annual rent increases decelerated in 34 markets when compared to the previous month.
Rents fell on a year-over-year basis in eight of the 50 largest U.S. markets, typically those that have absorbed large volumes of new supply. These include Austin (-2.4%), San Antonio (-1.6%), Tampa (-1.4%) and Denver (-1%). Some tighter markets are posting stronger gains. San Francisco leads with rents up 6.3% year over year, followed by Virginia Beach (5.7%) and Chicago (5.5%).
Among the 50 largest markets, Austin, San Antonio, Jacksonville, and Tampa had the highest vacancy rates at the end of 2025. Hartford, Boston, Denver, San Jose, and Providence had the lowest vacancy rates.
What’s ahead
Rent growth is projected to remain modest in 2026, with single-family rents forecast to rise 1.8% annually as of December 2026, and multifamily rents 0.9% over the same period. Elevated vacancy, continued apartment completions and more single-family homes entering the rental market are expected to keep national rent growth in check, although local conditions will vary.
Rents
- The typical asking rent is $1,895 in February, up 0.4% month-over-month. The pre-pandemic average month-over-month change for this time of year is 0.5%.
- Since the beginning of the pandemic, rents have increased by 35.5%.
- Rents are now 1.9% up from last year.
- Rents fell, on a monthly basis, in three major metro areas: Memphis (-0.2%), Houston (-0.1%) and Hartford (-0.1%).
- Rents are up from year-ago levels in 42 of the 50 largest metro areas. Annual rent increases are highest in San Francisco (6.3%), Virginia Beach (5.7%), Chicago (5.5%), San Jose (5.1%), and Cleveland (5%).
Single-Family Rents
- The typical asking rent for single-family homes is $2,195 in February, up 0.4% month-over-month. Since the beginning of the pandemic, single-family rents have increased by 44.2%.
- Single-family rents are now up 2.6% from last year.
- Single-family rents fell, on a monthly basis, in eight major metro areas. The largest monthly drops in single-family rents are in Orlando (-0.1%), Baltimore (-0.1%), Pittsburgh (-0.1%), and Milwaukee (-0.1%).
- Single-family rents are up from year-ago levels in 49 of the 50 largest metro areas. Annual single-family rent increases are highest in Providence (6.5%), Boston (5.6%), Milwaukee (5.3%), Cleveland (5.1%), and San Francisco (4.8%).
Multifamily Rents
- The typical asking rent for multifamily homes is $1,744 in February, up 0.4% month over month. Since the beginning of the pandemic, multifamily rents have increased by 27.3%.
- Multifamily rents are now up 1.4% from last year.
- Multifamily rents fell, on a monthly basis, in seven major metro areas. The largest monthly drops in multifamily rents are in Memphis (-0.3%), Louisville (-0.3%), Hartford (-0.2%), Indianapolis (-0.2%), and Houston (-0.1%).
- Multifamily rents are up from year-ago levels in 35 of the 50 largest metro areas. Annual multifamily rent increases are highest in Virginia Beach (6.1%), San Francisco (6%), Chicago (5.5%), San Jose (5.1%), and Providence (4.7%).
Rent Concessions
- 39.2% of rentals on Zillow offered concessions in February.
- The share of rental listings offering concessions increased by 0.3ppts month over month in February.
- The share of rental listings offering concessions decreased by 1.9ppts from last year.
- The share of rentals with concessions is lower, on a monthly basis, in 20 major metro areas. The largest monthly drops in the share of rentals with concessions are in San Jose (-4.7ppts), New Orleans (-2.3ppts), Detroit (-1.6ppts), San Francisco (-1.2ppts), and Chicago (-1.1ppts).
- The share of rentals with concessions is higher, on a monthly basis, in 30 major metro areas. The largest monthly increases in the share of rentals with concessions are in Louisville (4.2ppts), St. Louis (3.9ppts), Kansas City (2.8ppts), Indianapolis (2.7ppts), and Charlotte (2.5ppts).
- Rent concessions are up from year-ago levels in 18 of the 50 largest metro areas. The annual increase in share of rental listings with concessions is highest in Birmingham (11.8ppts), Tampa (9.5ppts), Las Vegas (9ppts), Columbus (4.5ppts), and Boston (4.4ppts).
Rent Affordability
- The median household would spend 26.3% of their income on a new rental in February.
- Rent affordability was flat month-over-month in February. The pre-pandemic share of median household income spent on rent was 25.5%.
- Rent affordability is now down 0.4ppts from last year.
- The most affordable metro areas for rents are Austin (17.9%), Salt Lake City (18.1%), Raleigh (18.4%), Minneapolis (19.4%), and Denver (19.4%).
- The least affordable metro areas for rents are Miami (37.2%), New York (37.1%), Los Angeles (33.9%), Riverside (30.9%), and San Diego (29.8%).
- Income needed to afford rent increased by 1.8% year over year in February to $75,803. Since pre-pandemic, the income needed to afford rent has increased by 35.4%.
| Metro Area | Typical Rent, Zillow Observed Rent Index (ZORI) | Typical Rent, Month-over-Month Change | Typical Rent, Year-over-Year Change | Renter Affordability (Share of Median Income Spent on Typical Rent) | Share of Rental Listings on Zillow Offering a Concession |
| United States | $1,895 | 0.4% | 1.9% | 26.3% | 39.2% |
| New York, NY | $3,258 | 0.5% | 4.2% | 37.1% | 19.0% |
| Los Angeles, CA | $2,884 | 0.2% | 1.1% | 33.9% | 30.0% |
| Chicago, IL | $2,132 | 0.9% | 5.5% | 26.8% | 22.0% |
| Dallas, TX | $1,630 | 0.3% | 0.2% | 19.9% | 61.8% |
| Houston, TX | $1,620 | -0.1% | -0.4% | 22.7% | 51.1% |
| Washington, DC | $2,331 | 0.5% | 0.2% | 21.1% | 56.1% |
| Philadelphia, PA | $1,859 | 0.6% | 3.1% | 23.3% | 32.9% |
| Miami, FL | $2,654 | 0.2% | 0.5% | 37.3% | 27.9% |
| Atlanta, GA | $1,808 | 0.2% | 1.6% | 22.3% | 56.2% |
| Boston, MA | $3,098 | 0.6% | 1.9% | 29.7% | 32.1% |
| Phoenix, AZ | $1,724 | 0.4% | -0.7% | 21.8% | 57.6% |
| San Francisco, CA | $3,103 | 1.1% | 6.3% | 25.9% | 30.4% |
| Riverside, CA | $2,478 | 0.4% | 1.7% | 30.9% | 28.1% |
| Detroit, MI | $1,461 | 0.2% | 2.4% | 21.8% | 27.0% |
| Seattle, WA | $2,181 | 0.2% | 1.8% | 22.2% | 53.9% |
| Minneapolis, MN | $1,664 | 0.6% | 4.0% | 19.4% | 40.7% |
| San Diego, CA | $2,871 | 0.5% | 1.6% | 29.8% | 36.5% |
| Tampa, FL | $1,976 | 0.3% | -1.4% | 28.6% | 49.9% |
| Denver, CO | $1,844 | 0.3% | -1.0% | 19.4% | 68.6% |
| Baltimore, MD | $1,857 | 0.3% | 2.5% | 21.5% | 39.3% |
| St. Louis, MO | $1,395 | 0.2% | 3.5% | 19.5% | 26.4% |
| Orlando, FL | $1,922 | 0.3% | 0.2% | 27.0% | 51.1% |
| Charlotte, NC | $1,716 | 0.3% | 0.5% | 22.6% | 64.1% |
| San Antonio, TX | $1,392 | 0.2% | -1.6% | 20.2% | 54.8% |
| Portland, OR | $1,779 | 0.3% | 0.9% | 20.4% | 49.6% |
| Sacramento, CA | $2,211 | 0.2% | 2.1% | 25.4% | 31.6% |
| Pittsburgh, PA | $1,446 | 0.2% | 3.8% | 21.1% | 26.9% |
| Cincinnati, OH | $1,536 | 0.7% | 3.5% | 21.5% | 24.2% |
| Austin, TX | $1,563 | 0.5% | -2.4% | 17.9% | 63.6% |
| Las Vegas, NV | $1,720 | 0.4% | -0.1% | 24.5% | 52.9% |
| Kansas City, MO | $1,481 | 0.4% | 3.5% | 20.1% | 37.1% |
| Columbus, OH | $1,484 | 0.5% | 1.7% | 20.3% | 45.3% |
| Indianapolis, IN | $1,486 | 0.1% | 2.6% | 21.3% | 44.2% |
| Cleveland, OH | $1,394 | 0.8% | 5.0% | 22.6% | 27.8% |
| San Jose, CA | $3,431 | 0.7% | 5.1% | 23.2% | 34.6% |
| Nashville, TN | $1,777 | 0.2% | 0.2% | 22.8% | 62.1% |
| Virginia Beach, VA | $1,787 | 0.5% | 5.7% | 24.6% | 27.6% |
| Providence, RI | $2,095 | 0.7% | 4.8% | 29.1% | 13.2% |
| Jacksonville, FL | $1,666 | 0.5% | 0.7% | 23.1% | 47.3% |
| Milwaukee, WI | $1,484 | 0.2% | 3.5% | 21.8% | 29.5% |
| Oklahoma City, OK | $1,359 | 0.4% | 2.6% | 21.1% | 29.7% |
| Raleigh, NC | $1,651 | 0.4% | 0.2% | 18.4% | 62.8% |
| Memphis, TN | $1,421 | -0.2% | 1.2% | 23.8% | 38.8% |
| Richmond, VA | $1,658 | 0.7% | 3.9% | 22.8% | 45.7% |
| Louisville, KY | $1,361 | 0.0% | 1.9% | 20.9% | 41.1% |
| New Orleans, LA | $1,577 | 0.3% | 0.2% | 28.8% | 16.1% |
| Salt Lake City, UT | $1,599 | 0.1% | -0.7% | 18.1% | 67.6% |
| Hartford, CT | $1,886 | -0.1% | 2.5% | 22.8% | 24.1% |
| Buffalo, NY | $1,374 | 0.5% | 3.6% | 21.7% | 9.5% |
| Birmingham, AL | $1,406 | 0.2% | 1.6% | 21.1% | 40.8% |
*Table ordered by market size
The post An Expanding Supply of Rentals Keeps Rent Growth in Check (February Rental Report) appeared first on Zillow Research.
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