Across the United States, apartment owners are offering massive discounts to attract renters. However, not all cities are making the same effort to attract new renters.
In July, six metropolitan areas — Raleigh, Charlotte, Atlanta, Salt Lake City, Nashville and Austin — offered rental discounts on more than half of their listings, according to a blog post by online real estate marketplace Zillow. These discounts ranged from free parking to a few weeks of rent-free housing.
The surge in rent concessions comes amid increasing housing supply after new housing construction began to accommodate rising rents during the pandemic, wrote Skylar Olsen, chief economist at Zillow.
According to Zillow, the vacancy rate remained at 6.6% nationwide in the second quarter of 2024, a record since 2021 and the same level as last year. Higher vacancy rates mean renters have more options and landlords have to work harder to attract them.
While rents across the country have increased 3.4% year over year, Zillow says concessions for tenants have also increased over the past two years. The share of rental listings with concessions rose from 19.4% in July 2022 to 33.2% last month, Zillow reported.
The increased rent concessions could provide some relief to tenants who are moving. Renters have long struggled with rising rental prices nationwide and often spend a significant portion of their income on rent, BI reported in January.
However, there are fewer concessions for renters in New York and Miami, who are struggling with affordability gaps. Both cities saw some of the lowest concession rates for the month, at 15.9% and 17.4% for New York and Miami, respectively. New York has seen comparatively few apartments built in recent years compared to other cities, while Miami has seen a flood of new residents in recent years.
In other cities, there are even fewer concessions: In New Orleans, only 10% of buildings offer such special concessions, and in San Jose, Baltimore, Milwaukee and Pittsburgh, the number of listings with concessions has declined from last year, according to Zillow.
“While rents are still rising, they are a far cry from the steep increases seen two or three years ago, and renters will find attractive deals at more than half of rent in some areas,” Zillow’s Olsen wrote. “If current trends continue, a weakening job market and lower mortgage rates could lead to falling rents.”
