US January Rent Growth is Almost Normal Again

US apartment rents inched up 0.16% in January, just below the 0.24% historical average, signaling rent growth is normalizing after 2H24 declines.
The Midwest and Northeast outperformed their long-term January averages, while the South and West trailed behind due to oversupply.
Austin and San Antonio saw the biggest rent cuts, while Detroit, Chicago, and Kansas City posted the highest growth.
Apartment occupancy increased to 94.9% in January, a positive sign that demand remains strong despite slower rent growth.

Key Takeaways

After seasonal rent cuts at the end of 2024, January revealed marginal rent growth, as reported by RealPage, indicating the most severe declines may be behind us.

Market-rate apartment rents rose 0.16% month-over-month, slightly below the 0.24% historical average for January from 2015 to 2024. While this 8-bps gap suggests rent growth is still lagging, the trend points toward a return to more typical patterns in 2025.

January rent growth still below long-term norm, but just barely

Regional Rent Performance

Not all regions followed the same trend. The Midwest and Northeast—markets with relatively low new supply—outpaced their long-term January averages:

Midwest: 0.31% rent growth (above the 10-year norm)
Northeast: 0.24% rent growth (slightly above average)
West: 0.11% rent growth (below the 0.28% norm)
South: 0.12% rent growth (half the long-term average of 0.24%)

Meanwhile, the supply-heavy South continues to see rent stagnation as the Midwest and Northeast see stronger growth due to limited new apartment construction.

Apartment rent growth leaders, year-ending January 2025

Markets with deepest rent cuts, year-ending January 2025

Annual Rent Growth Subdued

While month-over-month rent growth is improving, annual rent growth remains weak. Rents in professionally managed apartments inched up just 0.6% YoY in January—well below historical norms.

Midwest and Northeast posted the strongest rent growth of 2.9% and 2.7%.
West recorded near-flat growth of 0.2%.
South was the only region to see rents drop (-0.8%) over the past year.

Top And Bottom Performers

The cities with the fastest rent growth remain concentrated in the Midwest, where supply is more constrained:

Detroit, Chicago, and Kansas City led the nation, with 3.5% to 4% annual rent growth.

Meanwhile, Austin and San Antonio continue to struggle with rent cuts:

Austin reported an annual rent decline of -7.2%, the largest in the nation.
San Antonio reported an annual rent decline of -4.4%.

Simply put, these popular Texas markets have faced serious oversupply issues, forcing landlords to lower asking rents.

Occupancy Rates Tick Up

In a welcome contrast to seasonal trends, US apartment occupancy rose slightly in January, reaching 94.9%, or 10 bps above December’s rate. This mirrors historical norms, suggesting that demand for apartments remains relatively strong despite rent growth lagging behind past averages.

The Bottom Line

With rent growth nearing normal levels and occupancy stabilizing, 2025 could mark a turning point for the US rental market.

The pace of rent hikes will likely depend on regional supply levels, economic conditions, and affordability pressures. While the Midwest and Northeast continue to see steady rent gains, markets with excess supply—like Austin and San Antonio—may take longer to recover.