HousingWireHousingWire
The median asking rent for U.S. apartments declined slightly in March, but economists at Redfin say that new tariffs on building materials could soon push rental prices higher by limiting supply and boosting demand.
Redfin reported that the national median monthly asking rent was $1,610 in March, down 0.6% year over year and up 0.4% compared to February. This marks the 13th straight month in which year-over-year changes in rents have hovered within a narrow band of less than 1%.
Despite the current stability, Redfin economists warn that looming tariffs on imported building materials may trigger a reversal in rent trends by constraining new apartment construction activity and increasing economic uncertainty.
“America gets a lot of building materials from other countries, so tariffs will make building apartments more expensive. That could further hamper apartment supply, causing rents to jump,” Chen Zhao, Redfin’s economics research lead, said in a statement.
“Tariffs could also drive up rents by increasing demand. People may opt to rent instead of buy homes because the turmoil around tariffs has fueled widespread economic uncertainty. Tariffs have already caused huge swings in the stock market, and they will lead to higher prices for many goods and services, along with increased unemployment.”
Redfin agents say these concerns are already being felt in local markets. In Northern Virginia, where federal layoffs have affected many workers, some residents are choosing to rent rather than buy due to job insecurity.
“One of my customers is considering selling their home and renting for a year because they’re worried about losing their job,” said Matt Ferris, a Redfin Premier agent in the region. He noted that mass layoffs tied to the Elon Musk-led U.S. DOGE Service have hit the area particularly hard.
Will rising costs derail new construction?
Tariffs may also affect rental markets by increasing costs for essential building materials. The National Association of Home Builders (NAHB) reports that nearly one-quarter of the softwood lumber used in the U.S. — a key resource for apartment construction — comes from Canada.
During the post-pandemic housing surge, demand for rentals outpaced supply, driving up rents across the country. In response, developers began building at a rapid pace, which contributed to declining rents through 2023 and into early 2024. While new units are still entering the market, Redfin warned that rising construction costs could disrupt that balance.
The impact of rent changes varies widely by region. Austin saw the largest annualized decline in March, with the median asking rent dropping 10.7% to $1,420 — $379 below the city’s record-high figure. Other metro areas with significant decreases included San Diego (-9.7%); Portland, Oregon (-7.8%); Minneapolis (-7.8%); and Raleigh (-6.8%).
Meanwhile, rents rose most sharply in Cincinnati (+12.1%); Providence, Rhode Island (+11.4%); Cleveland (+10.6%); Washington, D.C. (+8.5%); and Baltimore (+8.4%).
“Cincinnati has seen an influx of new apartments, but not enough to meet demand,” said Cody Brownfield, a Redfin Premier agent. “Many of those new apartments are also in high-priced buildings.”
Across all unit sizes, studio and one-bedroom apartments saw rents fall 0.9% to $1,467. Rents for two-bedroom units fell 0.5% to $1,690, while rents for three-bedroom units were down 0.4% to $1,997.
