SANTA BARBARA, CA—An average monthly rent increase so small it barely registers as a fraction of 1%? In the long term, the moderation of growth is actually a positive, according to Yardi Matrix, which cites broad-based stability across the US apartment market in its latest monthly survey, issued Thursday.

July saw rents increase by an average of $1 to $1,350 across the 121 markets surveyed by Yardi Matrix. Rents were up by 2.6% year over year for the month, compared to 2.7% for June and a 6.8% Y-O-Y increase in September 2015.

Despite the month's virtually flat rent growth, Yardi Matrix sees “an overall healthy state” for the multifamily market nationally. For one thing, it's normal for rent growth to moderate in the second half of the year, and the year-to-date gains put 2017 above the long-term average. Trend-wise, says Yardi Matrix, “the market is in an extended period of rate-growth deceleration, coming down from unsustainably high increases—as high as 5.7% in early 2016.”

Also representing a positive is the even keel displayed among metro areas across the US. Among the top 30 in the Matrix Monthly survey, only Houston has negative Y-O-Y results, and 19 have increases of 2.0% or more. Moreover, “several of the markets that are at 2.0% or less—such as Portland, San Francisco and San Jose—are coming off periods of outsize gains and have recently showed signs of perking up again,” according to Yardi Matrix.

Sacramento once again led the nation in Y-O-Y rent growth, although the California capital city's days of double-digit annual gains are in the rear-view mirror, at least for now. It was followed by Seattle, California's Inland Empire, Los Angeles and Minneapolis-St. Paul.

Perhaps most important, says Yardi Matrix, absorption continues to drive fundamentals. “There has been little slowdown in job growth this year, despite the inability of Congress to implement new federal policy,” according to July's report. New jobs are helping to fuel household formation that drives demand for apartments, in turn keeping occupancies near historically high levels even though new supply is expected to hit a cycle high of 360,000 this year. Naturally, the downside of new completions includes “increased concessions for high-end units and growing vacancies in some submarkets.”

Instant Insights /

Apt. Markets See Stability Amid Growth Slowdown

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