PHILADELPHIA, PA — Asking rents in the Philadelphia metropolitan area rose 0.3% in September from a year earlier to a median of $1,785, bucking a national decline that has lasted more than three years but is now losing momentum, according to an October 15 report from Realtor.com.
The Philadelphia-Camden-Wilmington metropolitan area recorded rents $91 above the national median of $1,694, highlighting a regional market where rental costs continued to edge higher despite broader relief for tenants across much of the country.
Nationally, median asking rents for studio, one-bedroom and two-bedroom properties fell 0.4% year over year in September, marking the 38th consecutive month of annual declines. The decrease was the smallest in three years, signaling that the downward pressure on rents may be easing.
The typical asking rent remained $80, or approximately 4.5%, below its August 2022 peak. However, rents were still $214, or 14.5%, higher than before the pandemic.
The Philadelphia region’s modest annual increase contrasted with declining rents in several major metropolitan areas, including New York, where asking rents fell 0.2%, and Washington, where they declined 1.4%.
Rental concessions also varied considerably across markets. In the Philadelphia metropolitan area, 35.1% of studio, one-bedroom and two-bedroom listings offered concessions in September, compared with 43.9% nationally.
The national share increased 1.3 percentage points from a year earlier, indicating that landlords continued using incentives to attract tenants even as the pace of rent declines slowed.
“Renters are getting a break, but rents are still significantly more expensive than before the pandemic,” said Jiayi Xu, senior economist at Realtor.com.
“While asking rents are below their 2022 peak and concessions are still easy to find, for many households, relief is not the same as affordability.”
Realtor.com attributed the changing national rental market to three developments: a slowdown in new apartment supply in the Sun Belt, demand shifting toward more affordable metropolitan areas and employment growth associated with artificial intelligence in Northern California.
The strongest rent increases occurred in the San Francisco Bay Area, where technology-related employment demand has contributed to tighter rental conditions.
San Jose recorded a 6% annual increase, pushing its median asking rent to $3,565. San Francisco rents rose 4.8% to $3,057, approaching the market’s 2022 peak.
At the same time, the share of rental listings offering concessions fell sharply in both markets.
In San Jose, concession availability dropped from 51.9% a year earlier to 24.3% in September. San Francisco recorded a decline from 47.6% to 28.1%.
“The AI boom is fueling demand, and landlords are responding by tightening terms,” Xu said.
Other metropolitan areas experienced a reversal in rental trends as demand increased in relatively affordable markets.
St. Louis recorded a 2% annual rent increase after a 4.4% decline a year earlier. Minneapolis shifted from a 3.4% decline to a 1.7% increase, while Virginia Beach also recorded a 1.7% gain after falling 4.4% the previous year.
Realtor.com linked part of that shift to renters considering lower-cost alternatives to more expensive cities.
Chicago accounted for 45.4% of out-of-market rental demand in St. Louis during the third quarter and 27.3% in Minneapolis. Chicago’s own median asking rent reached $1,909 in September, up 2.3% annually.
Meanwhile, markets that experienced extensive apartment construction following the pandemic continued recording rent declines, although those decreases were becoming less pronounced.
Austin rents fell 2.3% annually in September, compared with a 7.8% decline a year earlier. Phoenix recorded a 1.9% decrease, narrowing from 5.8%, while Oklahoma City’s decline slowed to 1.4% from 6.5%.
The changes suggest that the supply-driven rental relief seen in several Sun Belt markets is beginning to moderate as the pace of new construction slows.
Pennsylvania’s other major metropolitan market included in the report, Pittsburgh, recorded a 2.2% annual rent increase to $1,462, exceeding Philadelphia’s percentage gain despite having a lower median asking rent.
Nationally, median asking rents varied by unit size. Studios averaged $1,422, down 1% annually, while one-bedroom properties averaged $1,568, down 0.4%. Two-bedroom properties averaged $1,890, a 0.3% decline.
Those categories have recorded annual rent declines for 38, 39 and 40 consecutive months, respectively.
Realtor.com expects monthly rents to soften during the typical autumn slowdown, although Xu cautioned that additional relief could be limited.
The September findings indicate that the national rental market is approaching a potential turning point after years of declining asking rents. In Philadelphia, where rents have already returned to modest annual growth, the figures show that the broader national decline has not translated into lower advertised rental costs.
The report analyzed advertised rents for studio, one-bedroom and two-bedroom properties across the nation’s 50 largest metropolitan areas, including apartments, condominiums, townhomes and single-family rentals. The figures reflect asking rents rather than amounts ultimately paid under signed leases.
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