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U.S. Apartment Rent Growth Eases to 1% in Q4 2024
National year-over-year asking rent growth eased to 1.0% in December 2024 compared to 1.1% at the end of September 2024, Apartments.com said Monday. Since mid-2023, Y-O-Y apartment rent growth has hovered around 1% after its rapid deceleration in 2021 and 2022.
The national rent per unit closed the year at $1,729, compared to $1,712 recorded at the end of 2023. Quarter-over-quarter rents fell by 0.4%, the second consecutive quarter of falling rents. The vacancy rate held steady at 8.0%.
Q4 recorded 113,200 units of absorption, the second consecutive quarter of easing. Supply additions in the quarter numbered 133,300, once again exceeding absorption, a trend seen since the fourth quarter of 2021.
However, Apartments.com said the gap between supply and demand is now at its smallest over that same period, suggesting more balanced market conditions. For full-year 2024, absorption reached 556,800 units, a 70% increase over 2023.
At 3.2%, Detroit ended Q4 with the strongest annual asking rent growth of the top 50 markets nationwide, with Kansas City and Cleveland close behind at 3.0% and 2.8%, respectively. Conversely, annual asking rent fell by 4.8% from the previous year in Austin. Denver, San Antonio, Jacksonville and Phoenix performed somewhat better.
A Yardi Matrix report issued just before the holidays predicted these rent-growth trends will continue. “Continuing record levels of new multifamily supply are expected to cap rent growth in markets that experienced rapid expansion during the pandemic,” the report stated. “Cities like Austin, Phoenix, Charlotte and Atlanta—which are adding units at an unprecedented pace—are forecast to see rent
growth continue to stagnate or even decline over the next two years, as new units gradually get absorbed by demand.”
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