Multifamily rent growth reached a new record in March 2024, recording the largest gain in 20 months. Asking rents for multifamily units increased $8 during the month to $1,721; year-over-year growth grew 30 basis points to 0.9 percent—a normal seasonal growth pattern according to Yardi Matrix.
In the March 2024 National Multifamily Report, Matrix’s data provides “some level of comfort” for worried market observers. While 13 of the top metros had negative rent growth over the past year, only two metros reported negative growth in March.
Where is multifamily rent growth the highest?
As the economy continues to create jobs, with household growth boosted by immigration and wage growth, demand for multifamily units continues to rise. Markets in the midwest, such as Columbus, Ohio, Kansas City, Mo., and Indianapolis, Ind., have the highest multifamily rent growth. These metros trailed only New York City, N.Y., which topped the list with 5% year-over-year rent growth.
In March, San Francisco, Calif., was the only metropolitan city to report a growth in occupancy rate (0.1%) year-over-year. On the other hand, 21 metros have occupancy rates down by 0.5% or more, including Atlanta, Ga., and Indianapolis (both down 1.2%).
National Lease Renewals
The national lease renewal rate averaged 64.8% at the beginning of 2024—the first time it’s dropped below 65% in more than two years.
Lease renewals were highest in metros like New Jersey (82.6%), Philadelphia, Pa. (77.4%), and Miami, Fla. (70.4%); renewals were lowest in San Francisco (53.5%), Los Angeles (57.6%), and Austin, Texas (58.2%).
Renewal Rent Growth
Year-over-year renewal rent growth—the change for residents that are rolling over existing leases—declined in January 2024 as well, to 4.6 percent.
According to the report, renewal rents have been down every month since May 2023. The metros with the highest year-over-year renewal rent growth include Indianapolis (8%), San Diego (7.8%), and Orlando (7.7%). Just two metros reported negative growth, with Las Vegas, Nev. (–2%) and Austin (–1.5%) at the end of the list.
RELATED
- Multifamily rent growth rate unchanged at 0.3%
- Expenses per multifamily unit reach $8,950 nationally
- Multifamily rents stable heading into spring 2024
Overall outlook for multifamily housing in 2024
From the December 2023 National Multifamily Report by Yardi Matrix:
- Expenses, income, deliveries, and interest rates pose key challenges for the multifamily industry this year
- Though the market is expected to deliver over 500,000 units this year, there is a dramatic decrease in starts
- Recent interest rate declines alleviate potential distress for multifamily owners, but long-term stability remains uncertain
Related Stories
Multifamily Housing | Mar 4, 2018
Katerra, a tech-driven GC, plots ambitious expansion
Investors flock to this vertically integrated startup, which automates its design and construction processes.
Multifamily Housing | Feb 28, 2018
Transwestern data points to demand for larger rental units among baby boomers
As baby boomers seek to downsize from large homes, developers are increasingly designing apartments specifically for this demographic.
Multifamily Housing | Feb 27, 2018
Victorian era gasholders become modern residences in London
The new residences are part of the King’s Cross redevelopment scheme.
Multifamily Housing | Feb 22, 2018
Multifamily building with 25,000 sf of amenities rises on the shore of the Potomac River
The building is part of the National Gateway mixed-use development at Potomac yard.
Multifamily Housing | Feb 15, 2018
United States ranks fourth for renter growth
Renters are on the rise in 21 of the 30 countries examined in RentCafé’s recent study.
Multifamily Housing | Jan 31, 2018
4 ways multifamily developers can attract Baby Boomer, Millennial buyers
As Baby Boomers downsize and Millennials begin buying homes, multifamily developments in dynamic urban areas are meeting the demand.
Sports and Recreational Facilities | Jan 25, 2018
Virginia Beach: A surf town with a wave problem no more
A world-class surf park will highlight Virginia Beach’s new live-work-play development.
Market Data | Jan 25, 2018
Renters are the majority in 42 U.S. cities
Over the past 10 years, the number of renters has increased by 23 million.
Resiliency | Jan 24, 2018
A luxury community in Florida mandates resilience in new-home construction
Alys Beach’s in-house GC builds to standards set by the FORTIFIED program.
Multifamily Housing | Jan 24, 2018
Apartment rent rates jump 2.5% in 2017, led by small and mid-sized markets
The average price for one-bedroom units increased the most.