This story was originally published in Multifamily Executive.
In September, annual rent growth declined for the first time since July 2012, according to the September Zillow® Real Estate Market Report.
The median rent is $1,440, 0.2% ($36) lower than it was in September 2017. Annual rent growth has slowed for eight consecutive months until now. Rent appreciation peaked at 6.6% in July 2015.
More than half of the country's 35 largest markets saw rents decrease on an annual basis. The biggest declines were in Portland, Ore., (2.7%) and Seattle (2.2%). Some markets, however, saw rising rents. Rents increased the most in Riverside, Calif., up 3% from last September.
Home value appreciation also slowed in September, down from 7.8% in August, though it grew 7.6% year over year to a median of $220,100.
Six of the largest housing markets saw double-digit appreciation, led by San Jose, Calif., where the median home value increased by 20.9%. Washington, D.C., homes saw the smallest appreciation, gaining 3.7% annually.
However, the slow down in price appreciation comes as mortgage interest rates are rising, and mortgage payments for the median-valued U.S. home are growing more than twice as fast as home values. Homes for sale declined 1.9% in September, dropping for the 44th consecutive month. However, about two-thirds of the nation's largest markets are seeing inventory increase, including some recently hot markets like Portland, Ore., Seattle, and the San Francisco Bay Area.
The slow down in both rent growth and home price appreciation may signal a stabilization in the housing market after a hectic few years.
"With slowing rents and home value growth, searching for a new home should be somewhat less competitive than it was a year ago, giving renters and buyers a bit of breathing room. Rents remain high by historic standards, but September's modest annual decline in rents should ease some of the pressure pushing higher-income renters to buy," said Zillow Senior Economist Aaron Terrazas. "And though home value appreciation is slowing, homes are more expensive than ever, making it difficult for first-time buyers to save for a down payment to break into the market."
Terrazas added that the slowdown in rent growth will be beneficial to residents, "putting more spending money in their already stretched pockets."
Learn more about what's happening in individual markets from Zillow's chart below:
| Metropolitan Area | Zillow Home Value Index, September 2018 | ZHVI Year- over- Year Change | Zillow Rent Index, September 2018 | ZRI Year- over- Year Change | Inventory Year- over-Year Change |
| United States | $ 220,100 | 7.6% | $ 1,440 | -0.2% | -1.9% |
| New York, NY | $ 431,000 | 5.2% | $ 2,370 | -1.9% | 5.2% |
| Los Angeles-Long Beach-Anaheim, CA | $ 647,100 | 5.4% | $ 2,750 | 0.8% | 29.9% |
| Chicago, IL | $ 222,200 | 5.3% | $ 1,635 | -1.9% | 2.7% |
| Dallas-Fort Worth, TX | $ 233,200 | 10.7% | $ 1,594 | -0.6% | 14.4% |
| Philadelphia, PA | $ 229,300 | 4.7% | $ 1,566 | -1.7% | -8.7% |
| Houston, TX | $ 200,900 | 6.3% | $ 1,548 | 0.1% | 0.6% |
| Washington, DC | $ 401,000 | 3.7% | $ 2,133 | -0.9% | 0.8% |
| Miami-Fort Lauderdale, FL | $ 278,400 | 8.0% | $ 1,855 | 0.1% | 4.8% |
| Atlanta, GA | $ 209,700 | 12.3% | $ 1,394 | 0.7% | -9.4% |
| Boston, MA | $ 458,000 | 6.2% | $ 2,367 | -1.6% | 16.7% |
| San Francisco, CA | $ 961,200 | 9.8% | $ 3,399 | -0.6% | 40.5% |
| Detroit, MI | $ 157,200 | 9.2% | $ 1,193 | 0.3% | 6.7% |
| Riverside, CA | $ 362,000 | 6.4% | $ 1,899 | 3.0% | 21.8% |
| Phoenix, AZ | $ 258,300 | 7.3% | $ 1,356 | 0.4% | -6.2% |
| Seattle, WA | $ 486,600 | 7.4% | $ 2,169 | -2.2% | 47.3% |
| Minneapolis-St Paul, MN | $ 263,300 | 6.8% | $ 1,638 | 0.5% | -1.9% |
| San Diego, CA | $ 589,200 | 5.9% | $ 2,541 | 0.0% | 47.1% |
| St. Louis, MO | $ 163,100 | 5.4% | $ 1,139 | -1.2% | -4.3% |
| Tampa, FL | $ 208,400 | 9.9% | $ 1,390 | 1.4% | 3.3% |
| Baltimore, MD | $ 265,600 | 4.5% | $ 1,740 | -0.2% | -0.2% |
| Denver, CO | $ 398,400 | 6.2% | $ 2,055 | 0.0% | 6.3% |
| Pittsburgh, PA | $ 142,300 | 7.1% | $ 1,085 | -1.0% | -15.4% |
| Portland, OR | $ 391,400 | 4.9% | $ 1,833 | -2.7% | 18.0% |
| Charlotte, NC | $ 199,400 | 10.5% | $ 1,293 | 0.0% | 0.4% |
| Sacramento, CA | $ 400,600 | 4.8% | $ 1,842 | 1.8% | 17.2% |
| San Antonio, TX | $ 187,800 | 6.1% | $ 1,330 | -1.1% | 11.0% |
| Orlando, FL | $ 231,000 | 9.7% | $ 1,449 | 1.0% | -2.8% |
| Cincinnati, OH | $ 164,500 | 7.2% | $ 1,277 | -0.4% | -2.3% |
| Cleveland, OH | $ 142,700 | 6.4% | $ 1,140 | -1.0% | -7.0% |
| Kansas City, MO | $ 185,500 | 9.1% | $ 1,264 | -1.4% | 0.5% |
| Las Vegas, NV | $ 273,800 | 15.4% | $ 1,305 | 1.4% | N/A |
| Columbus, OH | $ 184,200 | 7.9% | $ 1,336 | 0.4% | -8.1% |
| Indianapolis, IN | $ 157,200 | 11.0% | $ 1,195 | -1.2% | N/A |
| San Jose, CA | $ 1,288,700 | 20.9% | $ 3,499 | -0.9% | 138.1% |
| Austin, TX | $ 300,600 | 6.6% | $ 1,683 | -1.6% | 3.2% |
This story was originally published in Multifamily Executive.
