Rent growth slowing nationally, but Tampa rent rising faster than US

TAMPA, Fla. (WFLA) — A new report on rental price increases in the United States, published by real estate company Redfin, showed the median rent in the U.S. was up 2.4% for $1,940.

In Tampa, prices were up 3.5% and rent is over $2,000. It’s a trend in all of the Florida cities Redfin analyzed, where rent was up above national levels and increases.

While overall the rent increase in January was “the smallest increase since May 2021,” questions of affordability have not yet received an answer.

“We’re watching closely to see whether rents start falling year over year. That would be a welcome relief for renters  because it hasn’t happened since the onset of the pandemic,” Redfin Chief Economist Daryl Fairweather said. “If rents do start falling on a year-over-year basis, it will mean that renters have more room to negotiate. It may also prompt more landlords to sell their properties because they’re no longer getting a good return on their investment.”

Redfin reported that rent is still 22.5% higher than January 2020, and issues like inflation, high costs, and “widespread economic uncertainty” are slowing down what it calls household formation.

New construction and more homes switching from for-sale to for-rent have had an effect on rental supply growth, according to Redfin, with the national rental vacancy rate no longer falling, a change that came at the end of 2022.

The Federal Reserve reported the rent vacancy rate in the U.S. was 5.8% at the end of 2022.

Instead, Fairweather said he expects to see more rentals become available on the market, “an indicator that rental prices may continue to slow.”

Among the Florida cities surveyed for rent changes by Redfin, the median asking rent was highest in Miami, with a cost of $3,094 per month, while the city with the biggest proportional increase in Florida was Jacksonville, where rent in the past year has gone up 7.5%, putting it in the top 10 nationally for rent increases.

Among the cities examined, Tampa is middle of the pack, with a 3.5% increase year-over-year and rent at $2,197.

Further study of rent levels in Florida by Florida Atlantic University shows that, as of December 2022, major markets in the Sunshine State are experiencing premiums of a minimum of 7% above their expected costs.

Still, most of the areas surveyed in the end-of-year data show decreases month-over-month, with the exception of Jacksonville, North Port, and Cape Coral.