In a recent report by Redfin, the U.S. rental market saw a modest drop in asking rents for March 2025, bringing some short-lived relief to renters across the country. But experts warn: the respite may not last long.
As global trade tensions resurface and material costs soar, new tariffs—particularly on steel, aluminum, and lumber—could reverse these rental declines. For renters, that means the window of opportunity may be closing faster than expected.
U.S. Asking Rents in March: What Changed?
Redfin’s data shows the national median asking rent fell to $1,610 in March 2025, a 0.6% drop year-over-year, and a slight 0.4% increase month-over-month.
While this decline is relatively small, it’s part of a broader trend in rent stabilization following the post-pandemic construction boom. Over the past few years, developers raced to meet demand, resulting in a wave of new apartment buildings that temporarily boosted supply. This increased inventory has helped ease pressure on rental prices in many markets.
However, the market remains closely balanced. Rents are now hovering just $100 below their 2022 peak, and some analysts say that’s as low as they’ll go unless major economic or policy shifts occur.
Tariffs: The Hidden Threat to Renters
One of the biggest disruptors looming on the horizon? Tariffs on key construction materials.
The U.S. government has imposed or proposed steep tariffs on steel, aluminum, and Canadian softwood lumber—materials that are essential for building homes, apartments, and infrastructure. These tariffs significantly increase the cost of construction, which in turn:
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Discourages developers from starting new projects
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Raises the cost of existing developments
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Slows overall housing supply growth
And when supply slows down while demand remains strong—or even grows—rents rise.
As Redfin senior economist Sheharyar Bokhari explains, “Tariffs make it more expensive to build and renovate housing, which could stifle construction just as the rental market is beginning to balance out.”
This looming supply crunch could tip the scales back in favor of landlords, especially in markets where inventory is already constrained.
Regional Rent Trends: Some Cities Soar, Others Sink
The national average only tells part of the story. Rents across U.S. cities are moving in very different directions:
Markets with the Largest Rent Declines:
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Austin, TX: -10.7%
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San Diego, CA: -9.7%
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Portland, OR: -7.8%
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Minneapolis, MN: -7.8%
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Raleigh, NC: -6.8%
These cities saw the steepest rent drops—many of them due to high volumes of new housing hitting the market, giving renters more options and putting downward pressure on prices.
Markets with Rising Rents:
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Cincinnati, OH: +12.1%
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Providence, RI: +11.4%
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Cleveland, OH: +10.6%
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Washington, D.C.: +8.5%
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Baltimore, MD: +8.4%
These metros are seeing stronger rental price growth, often driven by steady demand and slower construction activity.
Rent by Bedroom Size: How Big is Your Budget?
Redfin’s data also breaks down rent trends by apartment size:
| Unit Size | Median Asking Rent | Year-over-Year Change |
|---|---|---|
| Studio/1-Bedroom | $1,467 | -0.9% |
| 2-Bedroom | $1,690 | -0.5% |
| 3-Bedroom | $1,997 | -0.4% |
While all categories saw slight declines, larger units are still commanding higher rents and appear to be stabilizing faster than smaller ones—perhaps reflecting a growing preference for more space in the remote work era.
What Does This Mean for Renters?
Right now, renters may feel a slight sense of relief—but experts caution that it could be temporary.
Here’s what to keep an eye on:
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Tariffs could stall new construction, tightening supply and pushing rents up again.
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Persistent inflation and economic uncertainty are keeping would-be homebuyers in the rental market longer, increasing competition for available units.
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Markets with limited inventory are especially vulnerable to rapid rent increases if demand continues to outpace supply.
Final Thoughts: Stay Informed, Stay Ahead
The rental market is in a delicate state. Although asking rents ticked down in March, policy changes, tariffs, and shifting economic conditions could undo that progress quickly. Renters, landlords, and investors alike should pay close attention to upcoming policy decisions—particularly around trade and housing development.
If you’re a renter looking for your next move, now may be a good time to lock in a lease before potential price hikes later this year.
Source: Redfin via Business Wire — Read the full article here