Anyone searching for a luxury apartment could find this a good time to go hunt. That's because asking rents have been slashed as a result of oversupply for the upscale market. And the situation is not expected to improve before 2025, as construction keeps going.
A new report from CoStar describes rent growth for luxury multifamily properties as "the weakest in recent memory." In the past two years, asking rent growth for all apartments plummeted from 10.3% to 0.8%. But the drop was even steeper for upscale four and five-star-rated apartments, which plunged from 11.8% year over year to -0.3% by 1Q2024.
The hardest hit region of the nation was the oversupplied Sunbelt. Here, multifamily completions surged by 78% from 2019 to 2023. And 50% more completions are anticipated for this year than in 2019.
Recommended For You
In Oakland, CA rents slumped 8.2% because of low demand and a surplus of luxury units. For the same reason, Austin was the location of nine of the 15 worst performing locations for high-end apartments.
"Stabilization of the top-end multifamily market is not expected until 2025, with little change anticipated in completion rates compared to record highs of the previous year," CoStar predicted.
© 2025 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
