The December 2023 National Multifamily Report by Yardi Matrix highlights the highs and lows of the multifamily market in 2023. Despite strong demand, the year-over-year (YOY) growth for rent remained largely unchanged at 0.3 percent—a stark contrast to December 2022's 6.4% YOY increase.
According to Yardi Matrix, 2023's full-year rent growth of 0.3% is the weakest rent performance since the 0.2% increase in 2010 (barring the 2020 pandemic year's 0.1% gain). Negative rent growth is affecting several major metropolitan areas as well, with Austin, Texas, ending the year at a -5.7% growth rate. Other metros such as Orlando, Fla.; Portland, Ore.; Phoenix, Ariz.; and Atlanta, Ga.; all are down by at least 3% year-over-year.
Strong job market
Despite the multifamily market ending 2023 on a downswing, conditions may not be as weak as they appear. A strong job market continues to drive demand and shows signs of holding up following the Federal Reserve's rate hikes.
Also aiding in demand is net immigration, which has increased by more than one million annually, according to the report.
Occupancy rates
The national occupancy rate left December 2023 at 94.8 percent, unchanged from the previous month. Rates were either unchanged or down YOY in all but five markets: Chicago, Ill. (+0.2% YOY), Seattle, Wash. (+0.2% YOY), Denver, Colo. (+0.1% YOY), Washington, D.C. (+0.1% YOY), and the Twin Cities (+0.1% YOY).
Atlanta had the largest decline of the year, down 1.3 percent.
Overall outlook for multifamily housing in 2024
- 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 | Feb 23, 2021
Rising costs push developers to consider modular construction
The mainstreaming of modular construction offers a cost-effective and creative solution to develop new types of urban developments.
Multifamily Housing | Feb 21, 2021
Multifamily Amenities Survey 2021: Early results show COVID-19 impact on apartment amenities
Survey of multifamily developers, owners, architects, and contractors shows many adjusting their amenities to deal with the impact of the pandemic on property occupiers.
Multifamily Housing | Feb 19, 2021
Former motorcycle factory converted into affordable housing
The Architectural Team designed the project.
Multifamily Housing | Feb 12, 2021
Benefits of a factory-installed ceiling radiation damper explained
Greenheck applications engineer Craig Kulski explains the benefits of a factory-installed ceiling radiation damper.
Multifamily Housing | Feb 10, 2021
The Weekly show, Feb 11, 2021: Advances in fire protection engineering, and installing EV ports in multifamily housing
This week on The Weekly show, BD+C editors speak with AEC industry leaders from Bozzuto Management Company and Goldman Copeland about advice on installing EV ports in multifamily housing, and advances in fire protection engineering.
Multifamily Housing | Feb 10, 2021
10 significant multifamily developments to open in late 2020 and early 2021
Seattle's new twisting condo tower and Rem Koolhaas's first residential building are among 10 notable multifamily housing projects to debut in late 2020 and early 2021.
Multifamily Housing | Feb 8, 2021
Vista Railing Systems expands its senior management team
Chris Dooley and Tom Killy join Vista Railings, the British Columbia manufacturer of commercial/multifamily railings.
Multifamily Housing | Feb 8, 2021
Veterans Village supplies 51 units of supportive housing for U.S. military veterans in Carson, Calif.
Withee Malcolm Architects designed the supportive housing community for developer Thomas Safran & Associates.
Multifamily Housing | Feb 2, 2021
Tahanan supportive housing development brings 145 apartments to San Francisco
David Baker Architects designed the project.
AEC Tech | Jan 28, 2021
The Weekly show, Jan 28, 2021: Generative design tools for feasibility studies, and landscape design trends in the built environment
This week on The Weekly show, BD+C editors speak with AEC industry leaders from Studio-MLA and TestFit about landscape design trends in the built environment, and how AEC teams and real estate developers can improve real estate feasibility studies with real-time generative design.