HouseCanary is reporting that at the end of the Q2 2018, their Canary Rental Index (CRI) showed a national median rental yield of 8.41%, down 0.19 percentage points from the end of the first quarter of 2018, when the national median rental yield was 8.60%. They attribute this to shrinking rental yields that’s been evident since at least July of 2013, when the national median rental yield almost hit double digits at 9.80%. In other words, investors who bought homes in June 2018 could expect a median return on investment of 8.41% nationwide; return on investment is higher in half the states and lower in half the states they analyzed. This is slightly lower than the median rental yield at the end of March 2018.
The national median rental price per square foot was 94 cents at the end of Q2 2018, and the median national rental price was $1,695. The national median home value in Q2 2018 was $217,400 in Q2 2018; this includes all single-family properties, including single-family homes, condos, and townhomes. They say that despite the trend of ever-smaller national median rental yields, there are still plenty of areas in the country where rental yield was in the double digits and grew in Q2 2018 instead of shrinking. In this report, they looked specifically at states and MSAs in Appalachia to provide some examples.
The Canary Rental Index (CRI) is HouseCanary’s pulse check of the rental market across the country. They look at home prices, rental returns, and other relevant metrics nationally and in each market to determine rental yield for real estate investors, then we release the CRI data online so users can see it and leverage it.