Where CRE Is Beginning to Lag

Demand and rent growth for apartments slowed in the third quarter, in a sign of a potential overall slowdown for commercial real estate more generally, though industrial demand continued unabated

“While the industrial boom continues to show no signs of stopping, multifamily absorption and rent growth are decelerating,” writes Nadia Evangelou of the National Association of Realtors in a new report. “Multifamily absorption in the last four quarters was below the pre-pandemic levels, in the range of 60,000-70,000 units. In the meantime, rents rose year-over-year at a slower pace, by less than a double-digit percentage. However, multifamily housing demand remains relatively strong. Considering rising mortgage rates and home prices, people may be forced to rent for longer due to decreasing affordability.”