A Split Housing Market
The housing market is telling two different stories depending on whether you rent or own. National rent growth has decelerated to about 3-4% year-over-year, down from the 8-12% spikes of 2021-2022. In some Sun Belt metros that saw explosive growth — Austin, Phoenix, Jacksonville — rents are actually flat or slightly declining as new apartment supply comes online.
But for prospective buyers, the picture is bleaker. With 30-year mortgage rates hovering near 6.9%, the monthly payment on a median-priced home ($420,000) is roughly $2,220 — about 60% higher than the same payment would have been at 2021's 3% rates on a cheaper home. The 'rate lock-in' effect means existing homeowners won't sell, constraining supply further.
Where Cooling Is Real
Several markets are genuinely cooling for renters: Austin (-2.1% YoY), Phoenix (-0.8%), Atlanta (flat), and parts of the Mountain West. The common thread is a wave of multifamily construction that started in 2021-2022 and is now delivering units. Markets that permitted aggressively are seeing the benefits of increased supply.
Meanwhile, the Northeast and California remain tight. New York, Boston, and San Francisco rents continue climbing 5-7% annually, constrained by decades of underbuilding and strict zoning. The lesson: housing inflation is hyperlocal, and national averages obscure vastly different realities.