BAM Key Details:

  • A new report from shows rent prices dropping for the third consecutive month as rental supply increases. 
  • July marks the first month of year-over-year rent price declines for studio units, while it continues annual rent drops for two-bedroom units (started in May) and one-bedroom units (started in June). 
  • Oklahoma City is the most affordable of the 50 major metros analyzed, based on the share of median household income required to cover the median asking rent. Miami, Florida, is the least affordable. 

The® July 2023 Rental Report is out, and, thanks to rising rental supply across the U.S., rent prices have fallen year over year for the third consecutive month. 

Rents for 0-2 bedroom units dropped -1.0% from July 2022 in the 50 largest U.S. metros. The median asking rent went up $15 from June to $1,759—down $18 from the peak set 12 months ago. 



Rents for one-bedroom and two-bedroom units declined again, year over year, but to a lesser degree compared to June. And studio rentals saw their first annual price decline since 2020. 

Nationwide, rent prices are more affordable in July 2023 compared to a year ago. The typical for-rent home required 25.9% of the typical household income—down from 26.5% in July 2022. 

That said, not every metro saw an improvement in rental affordability. 

Renters in many areas are now spending slightly less on rent relative to their overall income, giving their budgets a little more breathing room at a time of stubborn inflation and ongoing affordability concerns. With our midyear forecast update noting a surge in multi-family construction and an uptick in vacancy rates, we anticipate this downward pressure on rent prices will continue, providing many renters with much-needed stability in their housing expenses. Given the current rental market momentum and seasonal trends, it will be very unlikely to see a new peak rent in 2023.

Danielle Hale

Chief Economist at®

Rising rental supply is slowly improving rental affordability

In Q2 2023, completions of non-single-family homes increased 26.7% year over year. Rental vacancies also rose 0.7 percentage points to 6.3% over the same period. 

While those numbers are generally good news for renters, rental costs remain elevated, and the rental vacancy rate is still below the 7.3% average for 2013 to 2019. 

Still, the median rent for the 50 largest metros has continued the decline that started in May of this year. In July, it dropped -1.0% across all 0-2 bedroom rental units—slightly less than the -1.1% annual drop seen the previous month. 

Falling $18 below the peak set in July 2022, the median asking rent increased month over month by $15 to $1,759—24.75% or $348 higher than it was in July 2019. 

Studio rentals see their first annual rent price decline in over two years

Rent price trends varied a bit by unit size, with rents for two-bedroom units falling -1.1% year over year, slightly less than the -1.4% annual drop in June. Nationwide, the median rent for a two-bedroom unit was $1,945—down $21 from the peak set last July. But rent growth was highest for these larger units, climbing 26.9% or $413 over the past four years. 

Rents for one-bedroom units fell -0.6% year over year in July 2023—slightly less than its 0.9% annual decline in June. The median rent for these properties was $1,642, down $10 from the peak set in July 2022 but still 24.9% or $327 higher than it was four years ago. 

Studio rents declined year over year for the first time in over two years, dropping -0.4% compared to July 2022. The median rent for a studio was $1,445—down $6 from one year ago and $21 less than the peak set in August 2022. That said, it’s still $220 or 18.05% higher than it was four years ago in 2019. 



The Midwest has the most affordable metros—especially compared to coastal markets

For the purposes of®’s report, estimated affordability is based on the share of the median household income required to cover the median asking rent for a particular market. The U.S. Department of Housing and Urban Development (HUD) recommends 30% as the maximum share of income before housing costs are deemed burdensome. The lower the share, the greater the affordability. 

Keeping that in mind, eight of the 50 metros in the study had a rent share above 30% relative to the median household income for their market. And the least affordable among them was Miami, Florida, where the typical rent claimed 44.2% of the median household income. 

Eight markets with the highest shares of income going to rent:

  1. Miami, FL (44.2%)
  2. San Diego, CA (39.1%)
  3. Los Angeles, CA (39.1%)
  4. New York, NY (37.0%)
  5. Boston, MA (35.4%)
  6. Riverside, CA (33.9%)
  7. Tampa, FL (33.7%)
  8. Orlando, FL (31.3%)

Affordability actually worsened in three of those eight markets: Miami, New York City, and Boston. In Miami, the share of income going to rent increased by 0.1% from a year ago. 

At the other end of that spectrum was Oklahoma City, OK, where renters spent 18.4% of the median household income on the typical rent for their market. 

Top 10 most affordable markets, based on the income share required for the typical rent:

  1. Oklahoma City, OK (18.4%)
  2. Columbus, OH (18.7%)
  3. Minneapolis–St. Paul, MN (19.1%)
  4. Cincinnati, OH-KY-IN (19.7%)
  5. Kansas City, MO-KS (20.3%)
  6. Louisville/Jefferson County, KY-IN (21.1%)
  7. St. Louis, MO-IL (21.2%)
  8. Raleigh–Cary, NC (21.5%)
  9. Virginia Beach–Norfolk–Newport News, VA-NC (21.5%)
  10. Indianapolis–Carmel–Anderson, IN (22.2%)

The typical rent in Oklahoma City sits at 61% of the estimated maximum affordable rent (based on a 30% maximum share of the median household income). But rental affordability here has declined compared to a year ago when renters would spend 18.4% of their income on the typical rent—0.6% below the share for July 2023. 

Affordability improves the most in the West and South while rents rise in the Midwest

While rents in the West and South are still high, these regions have seen the biggest improvements in rental affordability, showing a consistent downward trend in rental costs compared to 12 months ago. 

Riverside, CA, saw the biggest improvement, with a 3.4 percentage point drop in the share of household income needed to cover the typical rent. That share dropped to 33.9% in July 2023. 

Midwest markets, on the flipside, saw increases in rental costs compared to a year ago as strong demand in markets like Milwaukee, WI, and Indianapolis, IN, whittled down the supply of vacant units, driving rents up. 

As renters determine their next move, whether it’s to stay put, save up to buy a home, or move and rent in a new location, the rental landscape is showing signs of improvement. To determine if renting remains the right choice for your household, free, trusted tools like our Rent Vs. Buy Calculator or our most affordable markets research can help renters make more informed housing decisions.

Jiayi Xu

Economist at®

Read the full report for more details. 

Takeaways for real estate agents

Today’s market presents a difficult situation for buyers and sellers alike. And what they don’t know can hurt them. Being the knowledge broker for your community means educating yourself on a daily basis. 

Watching the daily Hot Sheet is the best way we know to stay informed on trends in the U.S. housing market and the larger economy. Because every weekday, host Byron Lazine reviews the latest news updates, presenting them in a way that makes it easier to share the most impactful developments with potential clients—many of whom are currently renting. 

The Knowledge Brokers Podcast, airing every week on Friday, should also be on your must-watch (or must-listen) list to keep you not only informed but better able to articulate what’s going on in the market—and what it means for your clients. Tune in and enjoy the insights (and banter) of KBP’s three brilliant co-hosts. And prepare to take notes.

Whatever happens with mortgage rates in the coming months, you need to prepare for the conversations you’ll need to have with potential buyers to help them make decisions they can afford and feel good about.