Rent growth by property type
Looking at property types, higher-priced single-family units -- or properties that have rents at least 125% of the local median -- are seeing the biggest bounceback. According to CoreLogic, higher-price tier properties saw rents rise 5% in March -- up from 2.8% a year prior. It's the fastest rent increase on these units in about 15 years.
Detached single-family units are also doing great, as are larger properties. Detached units saw a record-setting 6.9% jump in rents between March 2020 and March 2021, while two-bedroom units have now surpassed their pre-pandemic growth rates, with rents up 5.2% over the year in April.
Units on the lower price tier (75% or less than the area's median rent) are doing the worst in terms of rent growth. Prices are up just 3.2%.
Tech cities are slowly recovering
If you're invested in any tech hubs -- or are considering it -- this is of note, too. According to Realtor.com's data, these cities are finally recovering (albeit slowly).
When working from home became the norm early last year, rents in these areas plummeted. Now, the average rent in tech centers clocks in at $2,086 -- its highest point in months. Semi-tech cities like Denver and Austin seem to be recovering the most, while larger, more traditional tech towns (San Francisco and Seattle, for example) are recovering more slowly.
“These hybrid tech markets, which have more diverse economies that don’t lean as heavily into the tech space as, say, San Francisco, have been able to stave off steep declines in rent and have therefore recovered quickly,” Realtor.com’s report reads. “Rental markets such as San Francisco and San Jose, which have seen rents decline by double digits, are indeed seeing signs of recovery but will take a bit longer to fully recover to pre-COVID levels.”
The bottom line
Median rents are finally bouncing back, so if you have vacancies coming up, it may be time to think about raising your rents -- especially if it's a large or detached unit. You might also consider a rent increase on existing tenants. Just make sure you give them plenty of heads up and be ready to remarket the property if they can't afford the hike.