“The share of San Jose listings offering concessions has fallen by more than half in a year, from 51.9% to 24.3%, while rents have climbed to record levels. The AI boom is fueling demand, and landlords are responding by tightening terms.”
Affordable alternatives and a Sun Belt correction
Out-of-market migration is reversing declines across lower-cost cities. In the third quarter of 2026, 45.4% of St. Louis rental demand originated from Chicago, where the median asking rent hit a new high of $1,909 in September, up 2.3% year over year.
St. Louis flipped from a 4.4% annual decline to a 2.0% gain; Minneapolis, drawing 27.3% of its out-of-market traffic from Chicago, moved from a 3.4% decline to a 1.7% gain.
In the Sun Belt, supply-driven declines are narrowing. Austin’s annual drop eased from 7.8% in September 2025 to 2.3% in September 2026; Phoenix from 5.8% to 1.9%; Oklahoma City from 6.5% to 1.4%.
For brokers, the September data reinforce a geographic imperative. With high mortgage rates continuing to weigh on the US housing market through 2026, local rent dynamics — surging in AI corridors, stabilizing in affordable alternatives — will shape renter-to-buyer conversion well into year-end.
