Rents in October fell by $3, according to Yardi Matrix, marking the second consecutive month of downward data. The Northeast and Midwest showed modest growth, but it was offset by declines in the Sun Belt and West.
The average U.S. asking rent fell $3 to $1,718 in October, while year-over-year growth fell to 0.4%, down 40 basis points from September.
Meanwhile, US average single-family rents declined by $2 to $2,121 and year-over-year growth dropped 30 basis points to 1%, but demand is holding steady and occupancy rates remain firm.
For the year, through September, more than 250,000 apartment units were absorbed nationally, according to Yardi Matrix.
“That is below the record-high 600,000 units absorbed in 2021, but in line with 300,000-plus units absorbed each year between 2017 and 2020,” according to the report.
“Whatever else is happening, people continue to rent apartments at a steady rate. Rent declines are largely a function of supply.
“There is concern that apartment demand will slow if the economic growth turns negative in line with consensus forecasts. A downturn would likely reduce renter activity.”
At the same time, Yardi Matrix indicated that multifamily demand is boosted by long-term trends that aren’t likely to fade.
“The cost gap between renting and homeownership has rarely, if ever, been higher, which keeps households in apartments. Demand is also created by the hybrid work trend as people seek more space for work.