Rentometer has just released its Q3 2024 National Single-Family Rentals Report, which highlights significant trends in the U.S. single-family rental market. Are you wondering how much single-family rental prices in Arizona have increased?

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Here are a few key takeaways regarding single-family rental prices in Arizona:

• National Rent Growth Slows: While single-family rental prices continued their upward trend, rising 3% year-over-year, growth has slowed compared to previous quarters.

• In the Southwest, single-family rent prices increased by 2.2% in Q3 2024, but many Arizona cities saw rent prices rise much faster than the regional average. In Scottsdale, the average rent for three-bedroom houses increased by 9% year-over-year, in Flagstaff and Tucson by 7%, and in Phoenix by 5%. On the other hand, several Arizona cities experienced annual declines in rent prices: Yuma saw a 6% decrease, while Gilbert and Buckeye dropped by 2%, and Maricopa by 1%.

• Scottsdale was the most expensive city to rent single-family homes in the Southwest, with three-bedroom houses averaging $3,986. Flagstaff ($3,048) ranked as the 3rd most expensive, while in Phoenix, the average rent for a three-bedroom home was $2,435.

• California Dominates Most Expensive Markets: San Francisco, Irvine, and Los Angeles rank as the most expensive cities for single-family rentals, with average rents exceeding $5,000 for a three-bedroom home. 

• At the other end of the spectrum, Toledo, OH ($1,214), Wichita, KS ($1,339), and Detroit, MI ($1,353) are among the most affordable large cities for single-family rentals.

Prices for single-family home rentals continued their steady growth in Q3 2024, increasing 3% year-over-year (Y-o-Y) and 0.5% over the prior quarter. While home rental prices grew, the pace of growth slowed from the previous quarter when annual growth was 4.2%.

One of the biggest drivers of growth in this segment is the ongoing demand for rental housing in both suburban and urban areas, fueled by high mortgage rates and rising home prices, which have kept many would-be buyers in the rental market.

According to the latest report from the National Association of Realtors (NAR), many prospective homebuyers are still struggling to afford current prices. As a result, transactions fell by 4.2% in August 2024 compared to the same month last year, with many delaying their home purchases.

While apartment rents have softened due to a boom in new construction leading to increased competition and higher vacancy rates, there has been limited new construction for single-family rentals as the vast majority of single-family rentals come from existing housing stock.

Regionally, the Midwest and Northeast saw the largest annual growth in single-family rental prices, each topping 9%, while the Southeast and Southwest experienced more modest growth, at 2.2% and 3%, respectively.

The regions with the highest rent growth also saw significant increases in home sale prices, highlighting that continued rises in home prices are likely to drive up rental prices as well.