2026 Rental Price Predictions from a Roundtable of Perspectives
We continue our timely theme of new year related content as 2026 gets off to its much-anticipated start. Today, the focus is on forecasting - specifically for pricing. Rental price predictions vary broadly depending who you ask. It feels like less of a reliable practice and more a game where anyone's guess could be right. You don't need that right now.
With so much invested in their properties, Airbnb operators need and deserve clarity. That's the only way anyone stands to achieve success this year or any other. To make combing through the conflicting possibilities easier, we've compiled a holistic summary of who's saying what about the future, along with some context why.
A Quick Recap of Rental Prices In 2025
Staring off with some precontext; 2025 can't be put into a box of 'good' or 'bad'. It really comes down to specific market nuances. We saw lots of things disrupt the landscape across North America, from increased Municipal Accommodation Tax (MAT) rates in Toronto to surprising interest rate moves from the U.S. Federal Reserve to proposals for 50-year mortgages.
Here's a month-by-month timeline:
January
U.S. and Canadian rents enter 2025 still near record highs, but growth is already slowing versus the surge years of 2021 - 2023. Early‑year forecasts project roughly flat to low‑single‑digit rent growth for 2025 across North America as new supply and weaker demand temper price gains. According to TD, interest rates will drive this cooling.
February
U.S. data through late winter show year‑over‑year rent growth moderating. Landlords in many gateway markets begin using more concessions (free months, flexible terms) rather than raising face rents aggressively.
March
Average U.S. asking rent sits just a few percent below its 2022 peak, underscoring that “softening” means slower growth, not cheap rents. Realtor.com reports March 2025 the 20th month in a row of year-over-year rent declines for 0 to 2 bedroom properties.
In Canada, national rent indices show modest year‑over‑year increases, with - no surprise - markets like Toronto remaining among the most expensive, particularly in central, high‑demand neighbourhoods.
April
By spring, multiple U.S. datasets confirm that 2025 is shaping up as a softer rent year, with only about 1% rent growth year‑to‑date.Investors and operators begin to talk more about occupancy optimization and revenue management, less about pushing double‑digit rent hikes.
May
New construction completions hitting the market add competitive pressure and cap rent growth in U.S. Sun Belt and secondary cities. American housing affordability debates set the stage for more radical ideas like ultra‑long mortgage terms north and south of the border.
June
Short‑term rental operators in Toronto must begin charging the 8.5% MAT on eligible bookings from June 1 onward, immediately impacting nightly all‑in pricing and net yields. The higher rate is scheduled to run through July 31, 2026.
July
Mid‑year rent data shows North American rents broadly plateauing: still historically high, but with minimal additional upside outside a few high‑growth pockets. In U.S. metros that added a lot of new supply, renters gain negotiation power, while landlord focus shifts to retention over aggressive price jumps.
August
Realtor.com is back with more numbers, these showing the U.S. median asking rent is up only about 1% year‑to‑date. It's far below the roughly 2.5%+ pace seen in a typical year before the pandemic.
September
Fall reports highlight that U.S. renters are finally seeing slight price relief after roughly four years of near‑continuous increases, especially in oversupplied segments. For operators, 2025 increasingly feels like a yield‑management year: adjusting minimum stays, fees, and add‑ons, rather than relying on headline rent hikes.
October
Additional U.S. data into autumn reinforce the narrative of stabilization, as reflected in modest or flat rent changes and some markets recording small annual declines. The Bank of Canada (BoC) announces a 25 basis point interest cut.
November
U.S. President Donald Trump publicly promotes the idea of 50‑year mortgages as a way to support housing demand. Canadian experts respond that Canada is very unlikely to adopt 50‑year mortgages, noting the country only recently allowed some 30‑year insured amortizations and has historically moved to shorten, not lengthen, terms.
December
In December, the U.S. Federal Reserve delivers a 0.25 percentage point cut to the federal funds rate, bringing the target range down to roughly 3.5% - 3.75%, its lowest level since 2022. The move caps a year in which policy rates finally begin to ease, improving the financing outlook for some investors but leaving borrowing costs well above pre‑pandemic lows.
Rental Price Predictions for 2025
As 2025 enters the history books, everyone's looking ahead to see what 2026 will be all about. A continuation of our current plot? Unexpected twists? Conclusions to old - or the creation of new - cliffhangers?
Here's what analysts are reading:
1. “Rents Will Keep Falling”
Some housing economists and listing‑site researchers expect national rents to edge down again in 2026, after small declines in 2025. Their models assume that a wave of new multifamily completions will keep vacancy slightly elevated while household formation and job growth slow, forcing landlords to compete more on price and concessions.
This view often points to forecasts of roughly a 1% national rent drop in 2026, following an estimated 1.6% decline in 2025, as new supply outpaces incremental demand in many metros. For short‑term rentals, the implication is softer ADR pressure in oversupplied or highly regulated markets, making occupancy, reviews and value‑adds more important than pure nightly rate growth.
2. “Rents Will Rise Modestly”
Another camp, including some brokerage research teams and big data platforms, calls for a small national rent increase - roughly in line with inflation, around 2% to 3% by late 2026. Their reasoning is that the worst of the new‑supply shock will be behind the market, while steady population growth and improving affordability in ownership keep many households renting longer.
3. “Select Markets Will Rebound Strongly”
Specialized multifamily investors and 1031 sponsors are more bullish in specific metros they believe are coming off a short, shallow downturn. Their data models show rent growth re‑accelerating to 3% to 3.4% in selected U.S. markets like Chicago, Indianapolis, Philadelphia and Seattle as absorption improves and new starts drop sharply.
The logic here is that 2024 to 2025 concessions and flat rents “reset” those markets, so by 2026 - 2027 they can grow from a healthier base, especially where migration and job growth remain strong. For STR operators in those areas, this view justifies a more optimistic pricing plan of anticipating higher ADR ceilings in peak seasons while still preparing for volatility if supply ramps back up.
4. “Affordability Will Cap Upside”
Bank economists and national brokerages often talk less about rent direction and more about an affordability ceiling that limits big rent hikes. Forecasts that keep mortgage rates in the low‑6% range and home‑price growth modest suggest ownership becomes slightly more reachable, forcing landlords to keep rent growth moderate so that housing costs stay near or below 30% of income.
In Canada, several outlooks describe 2026 as a “reset” or flat‑to‑slightly‑up year for home prices, with some provinces (Ontario, B.C.) even seeing continued price softness. The reasoning is that if ownership stops running away from renters and incomes rise a bit faster than housing costs, rent increases will be constrained, which nudges STR operators toward focusing on experience quality and occupancy rather than aggressive price escalation.
5. “Everything Depends on Local Supply”
A final perspective common among institutional owners and development analysts is that 2026 will be a hyper‑local story where national averages hide big differences driven by local supply pipelines. Markets where multifamily starts collapsed are expected to tighten and post above‑trend rent growth, while cities still digesting large deliveries may see flat or falling rents.
This reasoning leans heavily on construction and permitting data. Once the 2021 to 2022 cohort of projects is absorbed, new inventory slows to give landlords more pricing power where demand is steady. It's a perspective that argues for city‑level strategy: in tightening markets, confidently test higher rates in high‑demand periods; in oversupplied ones, lean on dynamic pricing tools, length‑of‑stay rules and differentiated amenities to defend revenue even if headline rents stall.
Forecasters are split on 2026 rents because they are starting from the same 2025 data but emphasizing different parts of the puzzle: supply, demand, financing and local policy. For an Airbnb operator, each “camp” implies a different pricing and budgeting approach, which is why understanding the reasoning matters more than any single headline number.
And remember, information is just information. It only has the power to make you profit when used strategically. After getting a feel for rental prices in 2026 in this review, we encourage all Airbnb operators to act - because no matter where you believe things are headed, the future is coming.
