Rental Vacancies Rise, Shifting Power to Renters

New apartment construction boosts supply, giving renters more leverage in many U.S. markets

Published on Feb. 22, 2026

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Rental vacancies rose to 7.6% nationwide in 2025, up from 7.2% the prior year, tipping the balance of power toward renters over landlords. Of the top 50 metro areas, 27 posted increases in rental vacancies last year, with markets like Austin, Texas and Buffalo, N.Y. seeing significant jumps. The surge in new apartment construction has helped create more negotiating room for renters, though affordability remains a concern as rents are still over 15% higher than pre-pandemic levels.

Why it matters

Housing costs have a significant impact on consumer spending and monetary policy, so a consumer-friendly rental market can boost the broader economy. Markets with rental vacancies of 7% or higher are generally considered more favorable for renters, allowing for more flexibility and choice in the housing search.

The details

Rental vacancies have climbed primarily due to a wave of new apartment construction, as developers responded to mounting affordability pressures with a surge in supply. Builders completed more than 500,000 rental units in 2025, not far off the record high set in 2024. Affordable housing construction also grew by 73% in the five-year period between 2020 and 2024, compared with the prior period. This increase in apartment construction is helping to lower rent payments, which fell 1.5% in January from last year and have declined for 29 straight months.

  • Rental vacancies rose to 7.6% nationwide in 2025, up from 7.2% the prior year.
  • Builders completed more than 500,000 rental units in 2025, not far off the record high set in 2024.
  • Affordable housing construction grew by 73% in the five-year period between 2020 and 2024, compared with the prior period.
  • Rents have declined for 29 straight months and are now down almost 5% from their summer 2022 peak.

The players

Danielle Hale

Realtor.com chief economist.

Jiayi Xu

Economist at Realtor.com.

Doug Ressler

Senior analyst at commercial real estate data firm Yardi Matrix.

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What they’re saying

“After years of being squeezed by limited inventory, renters are finally seeing the supply wave work in their favor. While the market isn't uniform everywhere, the broader trend is a move toward a much-needed equilibrium that allows for more flexibility and choice in the housing search.”

— Danielle Hale, Realtor.com chief economist (Realtor.com)

“In the Sun Belt and parts of the Midwest, new construction is helping to create negotiating room for renters. But in traditionally more affordable areas like Richmond and Pittsburgh, the secret is out; rising demand from out-of-towners is starting to soak up that excess vacancy, proving that renter-friendliness can be fleeting if supply doesn't keep pace with demand.”

— Jiayi Xu, Economist (Realtor.com)

“Elevated home prices and a shortage of attainable for-sale housing are pushing more residents toward rentals. For many households, single-family home ownership is simply out of reach—fueling demand for rental housing.”

— Doug Ressler, Senior analyst (Yardi Matrix)

The takeaway

The surge in new apartment construction, particularly in Sun Belt and Midwest markets, has shifted the rental landscape in favor of renters, providing more negotiating power and flexibility. However, affordability remains a concern as rents are still over 15% higher than pre-pandemic levels, highlighting the ongoing challenges in the housing market.