The Sun Belt stands out as the epicenter of rent declines over the past year.

According to Redfin data, nine out of ten of the biggest drops occurred in the Southwest and Southeast parts of the country, with the exception of Seattle.

Median asking rent year-over-year change—April 2024:

  1. Seattle, WA: -7.3%
  2. Austin, TX: -6.6%
  3. Nashville, TN: -5.9%
  4. Jacksonville, FL: -5.6%
  5. Miami, FL: -5%
  6. San Diego, CA: -4.7%
  7. Phoenix, AZ: -4.6%
  8. Charlotte, NC: -4.5%
  9. Tampa, FL: -4.3%
  10. Orlando, FL: -3.2%

Notably, Seattle, the only major metro to make the list that doesn’t lie within the Sun Belt, actually faced the worst rent drop in the country, slipping over 7% annually last month.

What’s causing the drop?

The pandemic triggered a significant shift in American relocation patterns. Many individuals opted for cheaper, rural living, leading to an exodus from cities.

At the same time, others sought refuge from colder northern climates, hoping to at least enjoy warmer weather during lockdown.

Now, with the pandemic housing boom behind us, property owners are having trouble filling rentals, says Sheharya Bokhari, Senior Economist at Redfin.

"The Sun Belt has built a ton of new apartments in recent years, partly to meet the surge in demand brought on by the flood of people who moved in during the pandemic housing boom. But the boom is over," Bokhari said.

The silver lining is that declining rent prices will cushion the blow for Americans grappling with the worst housing affordability crisis in history.

“The good news is that the uptick in housing supply in the Sun Belt has improved affordability for renters, which can be a lesson for other American cities grappling with housing affordability challenges,” said Bokhari.

While the Sun Belt (and Seattle) are experiencing rent declines, the same is not true across the United States.

In fact, the median U.S. asking rent increased by 1.1% annually in April, the first gain in the previous 12 months. On a monthly basis, asking rents rose 1.7%.

What do the numbers tell?

What happened in the Sun Belt is a textbook example of a supply/demand mismatch.

Areas that previously saw a massive influx in demand and booming construction are now facing a slight hangover now that demand is returning to normal.

Conversely, regions like the Midwest, which weren’t building as much as the Sun Belt and previously didn’t have the same level of demand, are now experiencing the fastest rent growth in the country.

The Midwest's status as the most affordable region in the U.S. is also helping bolster demand.

Despite the recent rent declines, many of the cities in the Sun Belt, like San Diego, remain some of the costliest housing markets in the United States

Still, for prospective renters looking for property in the region, the current environment may offer an opportunity for a relative discount, at least for now.