- U.S. single-family rent growth has cooled sharply, with October 2025 up just 0.9% year over year versus 2.8% a year earlier.
- Vacancy rates have climbed to roughly 6%+ nationally (and reportedly 7%+ in some markets), squeezing investor occupancy and cash flow.
- Lower-priced rentals are weakening more than higher-end units, with some metros posting outright rent declines.
- These trends are pressuring DSCR-financed investors and lenders, raising delinquency risk and the odds of forced sales.
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The recent data from Cotality’s Single-Family Rent Index (SFRI) paints a clear picture: the single-family rental market in the U.S. is undergoing a normalization, shifting from overheated growth to a state of deceleration and higher risk. October 2025’s rent growth of +0.9% year-over-year is among the weakest in more than 15 years, a stark contrast to +2.8% in October 2024.
This slowdown is broad, affecting both high-end rental properties (+1.4%) and especially low-end ones (+0.4%), with the latter segment seeing far greater pro rata losses. Detached homes and attached units show similar patterns, but all with markedly reduced growth.
Vacancy rates have risen sharply. Rentometer reports single-family rental vacancy rates exceeded 6% in Q1 2025—the highest since 2016. Separately, industry insiders claim some single-family vacancy rates have passed 7% in 2025. Elevated vacancy undermines DSCR loan assumptions that cash flows will be strong and continuous.
Investor behavior is adapting: selectivity is up, assumption of continual rent growth is down. Given rising vacancy and weak real rent growth (i.e. after adjusting for inflation), many DSCR properties may fail to cover debt service once costs (interest, maintenance, financing) and vacancy discounts are included. Some mortgages financed under optimistic projections are showing early signs of stress.
Regionally, there are bifurcations. Florida metro areas are leading in rent declines and in some cases had negative growth year-over-year. In contrast, markets in the Midwest and Northeast—Chicago, Detroit, Philadelphia—are more resilient, showing more favorable rent growth profiles.
For investment banking and lender strategy, these shifts imply several strategic pivots: underwriting must incorporate lower tail case rent growth and higher vacancy buffers; DSCR loan products may need restructuring; CRE financiers may see changing asset quality; and exit strategies (including sale to first-time buyers) may increase. Markets with strong labor and supply fundamentals—often in less overheated metros—may offer more durable returns.
Open questions remain: How will inflation-adjusted rents evolve if inflation remains sticky? Will supply constraints in certain metros (e.g., Midwest) offset national softening? What is the timeline for DSCR loan delinquency rates to rise materially, and will lenders preempt with tighter credit or increased rates?
Supporting Notes
- October 2025 rent growth nationwide was +0.9% year-over-year, down from +2.8% in October 2024.
- Low-end rents (≤75% of regional median) increased only +0.4% YoY in October 2025; high-end (≥125% of median) rose +1.4%.
- Chicago led among large metros with +4.6% growth in October 2025; Dallas saw a -1.3% YoY decline.
- Rent growth has weakened both for detached (+0.8%) and attached (+1.0%) single-family rental units.
- Vacancy rates rose to 6.3% for single-family rentals in Q1 2025, the highest since 2016.
- Some single-family rental markets reported vacancy rates exceeding 7% in 2025.
- DSCR loan delinquency rates have nearly quadrupled since mid-2022, with rates around 2% for securitized DSCR loans, up from ~0.5% in 2022.
- Despite slowing rent growth, single-family rents remain about 9% above average 2022 levels as of October 2025, reflecting cumulative past gains.