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 | Feb 16, 2024
5 emerging multifamily trends for 2024
As priorities realign and demographic landscapes transform, multifamily designers and developers find themselves in a continuous state of adaptation to resonate with residents.
MFPRO+ News | Feb 15, 2024
UL Solutions launches indoor environmental quality verification designation for building construction projects
UL Solutions recently launched UL Verified Healthy Building Mark for New Construction, an indoor environmental quality verification designation for building construction projects.
MFPRO+ News | Feb 15, 2024
Nine states pledge to transition to heat pumps for residential HVAC and water heating
Nine states have signed a joint agreement to accelerate the transition to residential building electrification by significantly expanding heat pump sales to meet heating, cooling, and water heating demand. The Memorandum of Understanding was signed by directors of environmental agencies from California, Colorado, Maine, Maryland, Massachusetts, New Jersey, New York, Oregon, and Rhode Island.
MFPRO+ News | Feb 15, 2024
Oregon, California, Maine among states enacting policies to spur construction of missing middle housing
Although the number of new apartment building units recently reached the highest point in nearly 50 years, construction of duplexes, triplexes, and other buildings of from two to nine units made up just 1% of new housing units built in 2022. A few states have recently enacted new laws to spur more construction of these missing middle housing options.
Multifamily Housing | Feb 14, 2024
Multifamily rent remains flat at $1,710 in January
The multifamily market was stable at the start of 2024, despite the pressure of a supply boom in some markets, according to the latest Yardi Matrix National Multifamily Report.
Sustainability | Feb 7, 2024
9 states pledge to accelerate transition to clean residential buildings
States from coast to coast have signed a joint agreement to accelerate the transition to pollution-free residential buildings by significantly expanding heat pump sales to meet heating, cooling, and water heating demand in coming years.
Multifamily Housing | Feb 5, 2024
Wood Partners transfers all property management operations to Greystar
Greystar and Wood have entered into a long-term agreement whereby Greystar will serve as property manager for all current and future Wood developed and owned assets.
Industry Research | Jan 31, 2024
ASID identifies 11 design trends coming in 2024
The Trends Outlook Report by the American Society of Interior Designers (ASID) is the first of a three-part outlook series on interior design. This design trends report demonstrates the importance of connection and authenticity.
Mixed-Use | Jan 29, 2024
12 U.S. markets where entertainment districts are under consideration or construction
The Pomp, a 223-acre district located 10 miles north of Fort Lauderdale, Fla., and The Armory, a 225,000-sf dining and entertainment venue on six acres in St Louis, are among the top entertainment districts in the works across the U.S.
Sponsored | BD+C University Course | Jan 17, 2024
Waterproofing deep foundations for new construction
This continuing education course, by Walter P Moore's Amos Chan, P.E., BECxP, CxA+BE, covers design considerations for below-grade waterproofing for new construction, the types of below-grade systems available, and specific concerns associated with waterproofing deep foundations.
