U.S. median asking rent rose 2.6% in August to $1,790, the sharpest jump since late 2022.
Rents are climbing again after nearly two years of stagnation, driven by strong demand and fewer new apartments hitting the market.
Chicago led the nation with an eye-popping 10.7% annual increase, while Austin saw the steepest drop at -3.1%.
After nearly two years of flat or falling rents, tenants are once again feeling the squeeze. The median asking rent climbed 2.6% year over year in August to $1,790, according to new Redfin data, marking the largest annual increase since December 2022 and bringing costs within $70 of the record highs seen during the pandemic housing frenzy.
Month over month, rents ticked up 0.3%, signaling that the recent upward momentum is unlikely to fade anytime soon.
Market analysts point to a simple supply-and-demand imbalance. Many would-be homebuyers remain stuck renting due to high mortgage rates and elevated home prices. At the same time, apartment construction – which boomed during the pandemic – has slowed significantly.
“Builders are pumping the brakes due to high financing costs, elevated construction expenses and weaker investor appetite,” said Redfin Senior Economist Sheharyar Bokhari. “With fewer new apartments coming on the market, renters have fewer options to choose from and landlords are regaining the ability to raise prices.”
In July, the number of new apartment completions fell to an annual rate of just 385,000 units, down 45% from the peak in 2024. Apartment permits have also dropped more than 20% compared to the pandemic surge.
Where rents are rising the most
Rent increases aren’t hitting every city equally. Chicago posted the steepest jump, with median asking rent up 10.7% to $2,275. San Jose (10.6%), Philadelphia (9.9%), Pittsburgh (9.8%), and Washington, D.C. (8.7%) followed close behind.
On the flip side, only three markets saw declines: Austin (-3.1%), Louisville (-2.4%), and Jacksonville (-1.9%).
For renters in high-growth metros, the leverage to negotiate for concessions like free parking or rent discounts may be slipping away as supply dries up.
Studio and one-bedroom units led the rebound, with asking rents rising 4.4% year over year to $1,650, the sharpest increase since September 2022. Two-bedroom apartments weren’t far behind, up 3.6% to $1,920. Larger apartments with three or more bedrooms held steady at $2,199 after five straight months of declines.
What it means for renters
The latest data suggest renters should brace for higher costs into 2026. With fewer new buildings breaking ground and strong demand keeping competition fierce, landlords are regaining bargaining power.
While some renters may still find incentives in slower-growth markets, the overall trend is clear: the era of widespread rent concessions is winding down, and affordability remains a challenge across much of the U.S. The chart below show year-over-year percentage changes in rent.
