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partment supply finally meets demand, easing renter pressure

    The rental market is shifting. Zillow’s latest data shows that for the first time in four years, renters are spending a smaller share of their income on housing—thanks to slower rent hikes and more landlord perks.

    Why the change? In 2024, builders poured record numbers of multifamily units into the market, the highest output in half a century. Senior economist Orphe Divounguy notes that the payoff is visible: markets that built faster now have more tenants who can afford a place. The South, with looser zoning and quicker construction, is leading the charge.

    Rent growth has slowed sharply. In September 2025, multifamily rents rose just 1.7 % year‑over‑year, the second‑lowest increase since 2021. A cooling labor market reduces mobility, dampening demand. Landlords are compensating by offering incentives: 37.3 % of listings now include a freebie—such as a month of free rent or waived parking—up from 14.4 % in 2019.

    Affordability is up overall. The average renter now spends 28.4 % of median household income on rent, below the 30 % burden line, and 38 of the 50 largest metros saw rent declines. Sun Belt and Mountain West cities—Austin, Denver, San Antonio, Phoenix, Orlando—recorded year‑over‑year drops. In contrast, supply‑tight markets like Chicago, San Francisco, and New York still see rent increases of 5–6 %. Single‑family rentals, once outpacing apartments, now grow only 3.2 % annually, the lowest since Zillow began tracking in 2016.

    Looking ahead, analysts predict concessions will rise further, peaking in winter when renter competition is low. Landlords may shift from perks to lower base rents. The experience of fast‑building markets underscores that matching supply to demand can curb cost escalation, though regulatory hurdles may slow progress elsewhere.

    Bottom line: after years of steep rent rises, the market is moderating. Renters now enjoy a modest reprieve, though relief varies by location.