ApartmentAdvisor National Rent Report

This month’s rent report focuses on three key findings:

1. Nationally, renters faced increases in rent this past month. The 1.6% increase in rent from February to March 2024 is the highest single-month increase in rent since June 2022. However, rents are still down compared to last year.
2. In Michigan, Ann Arbor and Detroit represent two extremes: Ann Arbor has had the greatest year-over-year rent increase from March 2023 to March 2024 in the country, while Detroit has had the greatest year-over-year decrease. However, Detroit residents pay a higher proportion of their income in rent.
3. States in the South have faced greater declines in rent over the past year than the rest of the country.

The National Picture: Median rent rose in March across the country for apartments of all sizes, marking the beginning of rent increases as summer approaches.

The cost of a median one-bedroom apartment increased from $1,378 in February to $1,400 in March. This increase was consistent with previous years; rent tends to be lowest in the winter and begins to increase in the spring, peaking in the summer. As more renters enter the market in the coming months, they can expect prices to continue to climb nationally.

The 1.6% month-over-month increase in rent is the highest since June 2022, when median rent costs jumped 6% over one month. Since the summer of 2022, the market has been cooling down to correct for this post-pandemic spike in rental costs. Despite this recent rent hike, rents remain down compared to the previous year (-3.5% compared to March 2023).

However, there are some indicators that the market is becoming less favorable for renters nationally. Three-bedroom apartments in particular faced notable month-over-month rent increases this month, rising from $1,899 in February to $1,950 in March. Larger apartments tend to have smaller fluctuations in rent from month to month, so this 2.69% increase was the largest single-month increase in three-bedroom rents in the past three years.

Local deep dive: Rental trends vary considerably depending on the local market, and nowhere is that more clear than in Michigan. Detroit has the fastest-declining rents in the country, while Ann Arbor has the fastest growing.

In Ann Arbor, median rent for a one-bedroom apartment has grown considerably over the past two years. Compared to March 2023, rents this past month were 35.4% higher; compared to March 2021, rents were 51.7% higher. That figure is the highest increase in the country —increasing from $1,250 to $1,896 in two years. In comparison, the national rent was 3.5% lower in March 2024 than in March 2023, and just 3.7% higher than in March 2022.

One reason for Ann Arbor’s outlier rental market is the role of the University of Michigan. The entire rental market revolves around the college calendar, and landlords can bank on apartments being rented in the fall as a new influx of students move into the city. ApartmentAdvisor data shows a steep drop in available units as the fall approaches. With such dependable demand, the city shows consistent year-over-year increases in rent.

Meanwhile, Detroit’s median rent, already below the national average, has continued to drop over the past two years. The 19% year-over-year decrease in rent from $1,164 in March 2023 to $928 in March 2024 was the biggest drop in the country.

Despite these drops in rent, most Detroit residents are finding renting unaffordable. According to the US Census Bureau, 61% of Detroit households are considered rent-burdened (spending over 30% of their income on rent). In comparison, 52% of households in Ann Arbor are considered rent-burdened. Nationally, 52% of all households are rent-burdened.

Detroit was hit particularly hard by the COVID-19 pandemic. Unemployment peaked in June 2020 at 43% (compared to the national rate of 11%), disproportionately impacting low-income households and people of color — and renters. The ongoing decline in rent is likely a reflection of inability for many Detroit residents to pay current market rates. While unemployment has since dropped to 8%, it remains above the national average, and the number of wage and salary jobs in the city declined from 2022 to 2023.