After Record Run-Up, Multifamily Rents Skid in NovemberBy RISMedia Staff
Year-over-year multifamily rent growth dropped to 7%, the lowest level in 17 months, according to a new report from Yardi Matrix.
Yardi Matrix’s latest National Multifamily Report found that asking rents fell $9 during November to $1,719. All of Yardi Matrix’s top 30 metros continue to display positive rent growth year-over-year according to the report, though more recent performance shows some weakness. Almost two-thirds of the top 30 had negative growth over the last three months and more than 90% had negative growth over the last month. The report also found that the single-family rental market is following the same pattern, with the average asking rent dropping by $5 to $2,091, and the YoY increase fell by 80 basis points to 5.9%. Despite the deceleration, 10 metros led by Sacramento and Washington, D.C., recorded asking rate gains of at least 10% during the month. Key highlights:
Major takeaway: “With the economy softening, demand for units slowing and rising interest rates creating headwinds for housing, multifamily asking rent growth finally took a turn downward in November,” said the author of the report. “The deterioration in rents was not unexpected nor is it necessarily a sign of a deep recession. Rent increases have far exceeded normal growth patterns for nearly two years.” “The weakening of demand can be seen in declining occupancy rates,” added the author. “Nationally, the average occupancy rate for stabilized properties was 95.6% in October, down 60 basis points YoY. However, the occupancy rate has fallen by 1% or more over the last year in nearly half of the top 30 metros, with the biggest declines in Las Vegas (-2.5% to 93.6%), Tampa (-1.9% to 94.8%) and Phoenix (-1.9% to 94.1%).” For the full report, click here. |
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