Rental affordability reaches four-year high

Rhea-AI Summary

Zillow (ZG) reports rental affordability at a four-year high: a typical rental now requires 28.4% of median household income, down from 28.8% a year ago and below the 30% burden threshold. National observed rent (ZORI) is $1,979 with 2.3% YoY growth; multifamily rent growth eased to 1.7% YoY and single-family rent growth hit a record-low 3.2% YoY.

Landlord concessions reached a record September high of 37.3% of listings. Several Sun Belt and Mountain West metros posted falling apartment rents, led by Austin (-3.3% ZORI) and Denver (-2.1% ZORI). Builders finished more multifamily units in 2024 than any year in a half-century.

Positive

• Concessions at a record 37.3% of listings
• National ZORI of $1,979 with 2.3% YoY
• Multifamily rent growth eased to 1.7% YoY
• Builders finished most multifamily units in 2024 in 50 years
• Affordability improved to 28.4% of median income

Negative

• Single-family rent growth slowed to a record-low 3.2% YoY
• Austin ZORI declined 3.3% YoY (multifamily -4.7%)
• Denver ZORI declined 2.1% YoY (multifamily -3.4%)
• High rent growth in some metros: Chicago 6.0% YoY, New York 5.2% YoY
• Some large metros require >40% of income (New York 40.6%)

Rent growth cools and concessions from landlords rise to new record levels

• Rental affordability is better than it's been in four years, requiring 28.4% of median household income nationwide.
• Landlords are offering concessions on 37.3% of rentals on Zillow, a record high for September.
• Single-family rents are up 3.2% year over year, a record low in Zillow records.

SEATTLE, Oct. 17, 2025 /PRNewswire/ -- Rental affordability is better than it's been in four years, giving prospective renters a slight break on new leases. Subdued rent growth and record-breaking concessions from landlords are turning up now after a deluge of newly built apartments hit the market last year, according to the latest rental market report from Zillow®. 

Builders responded to a surge of demand for housing during the pandemic, finishing more multifamily units in 2024 than any year in a half-century. Builders in the South, where there are fewer zoning restrictions, reacted more quickly and efficiently to renters' needs, helping create pockets of affordability. 

"Markets that built more — and faster — are seeing that investment pay off with more renters able to comfortably afford an apartment," said Orphe Divounguy, senior economist at Zillow. "It's a reminder that housing costs can be tamed when policy allows supply to keep up with demand."

National rent growth in multifamily units on Zillow eased to 1.7% over last year in September — the second-lowest annual growth seen since 2021. A weaker labor market is also contributing to slower rent growth this year: New jobs are highly important for residential mobility. 

Zillow's new rent market dashboard shows falling apartment rents are concentrated in the Sun Belt and the Mountain West regions. 

Apartment rents are falling fastest year over year in Austin (-4.7%), Denver (-3.4%), San Antonio (2.3%), Phoenix (-2.2%), and Orlando (-0.8%). Higher rent growth is centered in areas with stricter building regulations and in high-demand, relatively affordable areas, led by Chicago (6%), San Francisco (5.6%), New York (5.3%) Providence, Rhode Island (4.8%), and Cleveland (4.2%). 

Even single-family rents – which have significantly outperformed apartments in recent years – are feeling headwinds. September's 3.2% year-over-year rise in single-family rent is the smallest annual growth in Zillow records that start in 2016. 

Freebies for renters rise
In recent years rental managers have turned to concessions, such as free months of rent or free parking, instead of lowering rents. Now 37.3% of rentals on Zillow offer some sort of freebie — a new record high for September and up from 14.4% in 2019. 

Those concessions likely will continue to rise; they typically peak in winter or early spring. As concessions become the norm, property managers may need to consider price cuts, particularly as the year winds down. Competition among prospective renters tends to fall off over the cooler winter months.

Affordability improves nationwide as rents ease
Cooler growth and even declining rents in some rental markets are contributing to better nationwide affordability than renters have seen in four years. A typical rental now requires 28.4% of the median household income nationally, down slightly from 28.8% a year ago and below the 30% threshold where housing becomes a financial burden. 

Rent affordability improved over the past year in 38 of the 50 largest U.S. metros, and renters in Denver, Austin, Miami, San Antonio and Phoenix were the biggest beneficiaries.

Metro Area*	Zillow Observed Rent Index (ZORI)	ZORI Year over Year (YoY)	ZORI as Share of Median Family Income	ZORI as Share of Median Family Income in Sept. 2024	Share of Rentals with a Concession	ZORI Multi- family YoY	ZORI Single- Family YoY
United States	$1,979	2.3 %	28.4 %	28.8 %	37.3 %	1.7 %	3.2 %
New York, NY	$3,512	5.2 %	40.6 %	40.0 %	18.2 %	5.3 %	4.1 %
Los Angeles, CA	$2,954	2.4 %	35.5 %	35.9 %	27.6 %	1.6 %	3.9 %
Chicago, IL	$2,113	6.0 %	26.8 %	26.2 %	22.6 %	6.0 %	5.5 %
Dallas, TX	$1,706	0.1 %	21.8 %	22.5 %	58.9 %	-0.6 %	0.9 %
Houston, TX	$1,675	0.5 %	23.4 %	24.2 %	47.9 %	-0.1 %	1.4 %
Washington, DC	$2,414	1.4 %	22.0 %	22.5 %	53.4 %	0.3 %	3.6 %
Philadelphia, PA	$1,881	3.7 %	24.2 %	24.2 %	30.4 %	3.1 %	4.2 %
Miami, FL	$2,679	0.8 %	38.6 %	39.7 %	25.3 %	1.5 %	1.0 %
Atlanta, GA	$1,882	2.5 %	24.1 %	24.3 %	55.9 %	1.4 %	3.8 %
Boston, MA	$2,965	2.9 %	29.7 %	29.9 %	31.0 %	2.7 %	4.1 %
Phoenix, AZ	$1,776	-0.8 %	23.0 %	24.1 %	55.6 %	-2.2 %	1.1 %
San Francisco, CA	$3,148	5.6 %	27.4 %	26.9 %	33.9 %	5.6 %	3.6 %
Riverside, CA	$2,536	2.0 %	31.7 %	32.2 %	28.5 %	1.5 %	2.0 %
Detroit, MI	$1,510	3.0 %	23.3 %	23.4 %	24.1 %	2.3 %	3.2 %
Seattle, WA	$2,258	2.6 %	22.6 %	22.7 %	51.1 %	2.0 %	3.3 %
Minneapolis, MN	$1,705	3.9 %	19.9 %	19.9 %	41.3 %	3.3 %	4.5 %
San Diego, CA	$3,016	1.9 %	32.0 %	32.6 %	37.6 %	1.3 %	2.7 %
Tampa, FL	$2,055	1.8 %	31.2 %	31.7 %	46.3 %	1.4 %	2.4 %
Denver, CO	$1,949	-2.1 %	20.9 %	22.2 %	64.8 %	-3.4 %	1.2 %
Baltimore, MD	$1,943	3.0 %	22.9 %	23.0 %	38.9 %	1.9 %	4.1 %
St. Louis, MO	$1,407	4.0 %	20.1 %	20.0 %	20.0 %	3.0 %	5.5 %
Orlando, FL	$1,989	0.3 %	28.2 %	29.1 %	50.3 %	-0.8 %	1.8 %
Charlotte, NC	$1,770	1.2 %	24.0 %	24.6 %	62.7 %	-0.6 %	3.7 %
San Antonio, TX	$1,459	-1.1 %	22.2 %	23.2 %	52.8 %	-2.3 %	0.9 %
Portland, OR	$1,860	1.2 %	21.7 %	22.2 %	45.8 %	0.4 %	2.7 %
Sacramento, CA	$2,300	2.0 %	26.6 %	27.1 %	31.0 %	1.6 %	2.1 %
Pittsburgh, PA	$1,464	3.9 %	22.5 %	22.4 %	24.4 %	3.0 %	5.4 %
Cincinnati, OH	$1,539	3.4 %	21.9 %	22.0 %	19.2 %	2.6 %	4.8 %
Austin, TX	$1,616	-3.3 %	18.2 %	19.4 %	60.4 %	-4.7 %	0.0 %
Las Vegas, NV	$1,754	0.2 %	25.5 %	26.4 %	48.3 %	0.0 %	0.6 %
Kansas City, MO	$1,510	4.5 %	21.1 %	20.9 %	32.7 %	3.7 %	5.3 %
Columbus, OH	$1,562	2.7 %	22.4 %	22.7 %	42.7 %	2.2 %	3.9 %
Indianapolis, IN	$1,511	3.5 %	21.4 %	21.5 %	41.8 %	2.2 %	5.6 %
Cleveland, OH	$1,419	4.9 %	23.2 %	22.9 %	24.4 %	4.2 %	5.4 %
San Jose, CA	$3,500	3.7 %	25.3 %	25.4 %	42.7 %	3.3 %	3.8 %
Nashville, TN	$1,815	0.6 %	23.5 %	24.3 %	61.7 %	-0.6 %	2.8 %
Virginia Beach, VA	$1,820	4.2 %	25.3 %	25.2 %	29.8 %	4.0 %	4.0 %
Providence, RI	$2,168	4.6 %	28.8 %	28.5 %	12.8 %	4.8 %	4.5 %
Jacksonville, FL	$1,706	1.1 %	24.8 %	25.5 %	46.9 %	0.0 %	2.4 %
Milwaukee, WI	$1,451	4.0 %	20.8 %	20.8 %	30.0 %	3.7 %	5.9 %
Oklahoma City, OK	$1,372	3.1 %	21.8 %	21.9 %	28.6 %	2.3 %	3.5 %
Raleigh, NC	$1,713	0.7 %	19.7 %	20.2 %	61.5 %	-0.7 %	2.1 %
Memphis, TN	$1,485	1.9 %	25.7 %	26.2 %	37.6 %	-0.2 %	3.2 %
Richmond, VA	$1,705	3.9 %	22.2 %	22.2 %	47.0 %	3.2 %	4.8 %
Louisville, KY	$1,358	2.9 %	21.9 %	22.1 %	39.1 %	1.6 %	4.9 %
New Orleans, LA	$1,621	0.6 %	29.3 %	30.3 %	18.1 %	-0.4 %	2.3 %
Salt Lake City, UT	$1,668	0.1 %	19.5 %	20.2 %	59.2 %	-0.6 %	1.3 %
Hartford, CT	$1,936	3.8 %	23.2 %	23.2 %	24.5 %	3.6 %	3.8 %
Buffalo, NY	$1,382	3.0 %	21.9 %	22.1 %	6.2 %	3.1 %	3.7 %
Birmingham, AL	$1,396	2.7 %	22.4 %	22.6 %	34.0 %	0.0 %	5.2 %
*Table ordered by market size

About Zillow Group: 

Zillow Group, Inc. (Nasdaq: Z and ZG) is reimagining real estate to make home a reality for more and more people. As the most visited real estate app and website in the United States, Zillow and its affiliates help people find and get the home they want by connecting them with digital solutions, dedicated real estate professionals, and easier buying, selling, financing, and renting experiences. 

Zillow Group's affiliates, subsidiaries and brands include Zillow®, Zillow Premier Agent®, Zillow Home Loans℠, Zillow Rentals®, Trulia®, Out East®, StreetEasy®, HotPads®, ShowingTime+℠, Spruce®, and Follow Up Boss®. 

All marks herein are owned by MFTB Holdco, Inc., a Zillow affiliate. Zillow Home Loans, LLC is an Equal Housing Lender, NMLS #10287 (www.nmlsconsumeraccess.org). © 2025 MFTB Holdco, Inc., a Zillow affiliate.

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SOURCE Zillow

FAQ

What did Zillow report about national rental affordability on October 17, 2025 for ZG?

Zillow reported national rental affordability at 28.4% of median household income on Oct. 17, 2025, down from 28.8% a year earlier.

How common are landlord concessions in Zillow listings in September 2025 for ZG data?

Landlord concessions appeared on 37.3% of Zillow rental listings in September 2025, a record high for that month.

Which metros showed the largest year-over-year ZORI declines in Zillow's Oct. 17, 2025 report?

Austin (-3.3% ZORI, multifamily -4.7%) and Denver (-2.1% ZORI, multifamily -3.4%) showed the largest declines.

What is Zillow's national ZORI and overall YoY rent growth reported Oct. 17, 2025?

The national ZORI was $1,979 with overall YoY rent growth of 2.3% and multifamily growth of 1.7%.

How did single-family rent growth perform in Zillow's September 2025 data for ZG?

Single-family rent growth was 3.2% YoY in September 2025, the smallest annual increase in Zillow records dating to 2016.

What effect did 2024 multifamily construction have according to Zillow's Oct. 17, 2025 report?

Builders finished more multifamily units in 2024 than in any year in the past 50 years, alleviating some rental pressure in markets that built fastest.