U.S. asking rents registered largest gain in 20 months in March
SANTA BARBARA, Calif., Apr. 4, 2024 – The U.S. multifamily market signaled a normal seasonal growth pattern in March, according to the latest Yardi® Matrix National Multifamily Report.
The average U.S. asking rent gained $8 to $1,721 in March, for a 0.9 percent year-over-year increase, 30 basis points above the previous month. Meanwhile, the occupancy rate decreased 10 basis points in the 12 months ending in February, to 94.5 percent.
Markets in the Midwest and Northeast continued lead in Matrix’s top 30 metro rankings. Over the past year, rent growth was negative in 13 of these top 30 metros, while over the first quarter just four metros posted negative rent growth. More so, just two metros recorded negative rent growth in March, with Austin ranking lowest (-5.9 percent).
Rents rose 0.5 percent month-over-month in both asset classes. Monthly gains were largest in Columbus (1.3 percent), Orlando and Seattle (both 1.1 percent). Rents declined only in Nashville (-0.3 percent) and Baltimore (-0.1 percent).
“Also a good sign is that rents are rising again even in markets where occupancy rates are declining due to the heavy supply growth,” states the report, exemplifying through Orlando (rent growth at 1.4 percent in March, and stock expansion at 4.0 percent over the last 12 months) and Charlotte (1.3 percent rent growth and 5.5 percent stock expansion).
Renewal rent growth decelerated to 4.6 percent in January, while the national lease renewal rate dropped to 64.8 percent, marking the first dip below 65 percent in more than two years.
The average rent for single-family rentals rose $9 in March to $2,144, for a 1.2 percent year-over-year increase. Occupancy in the sector slid 10 basis points to 95.3 percent in February. Demand for single-family homes coupled with tepid home sales sustain fundamentals, more so considering that the median home mortgage payment is about 40 percent higher than the median rent in the U.S.
Gain more insight in the new Yardi Matrix National Multifamily Report.
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