Economy

Housing Market Trends Drive Single-Family Home Rental Prices

The cost to rent a single-family home spiked 10.9% in October as supply fails to meet demand.

Housing Market Trends Drive Single-Family Home Rental Prices
Gene J. Puskar / AP
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If you're looking to rent a single-family home, you are in for some sticker shock. Rent for these properties shot up nearly 11% in October. The massive jump is due to a familiar scenario — too much demand and not enough supply.

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In the first half of October, numbers were 38% above August levels and 25% higher than in September, but they're still well below pre-pandemic levels.

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Vacancy rates are at a 25-year low and many in the market have been priced out of buying a home — forcing them to rent instead.

Research economist Luis Bernardo Torres Ruiz says high home prices are driving some people to rent, which raises demand and prices for those rental properties.

"I think we've definitely reached the peak," Ruiz said. "Now we're expecting the market to go back to normal levels. In the coming months and the coming year, we expect the market to go back to pre-COVID levels."

However, if you don't want to deal with the rising rental prices, Ruiz recommends buying a house if it's something that fits your budget.