The U.S. effective asking rent is expected to grow at an average annual rate of about 2.3% across the country this year, according to a RealPage market forecast.
Of the 50 largest markets studied by RealPage, seven are expected to stand out with rent growth exceeding 3.4%. Those markets include Richmond, Virginia, and West Palm Beach, Florida, representing the South region; Kansas City, Missouri, representing the Midwest region; Boston, Philadelphia and Pittsburgh representing the Northeast region; and San Jose for the West.
The largest number of markets within RealPage’s top 50 are expected to experience rent growth above the national average but below 3.2% over the coming year. About one-third of all markets fall into this category, including several large Midwestern regions that have experienced steady performance in recent months, such as Chicago, Milwaukee, Detroit and Indianapolis. Other markets expected to be included in this bucket include California's Anaheim, Riverside and San Francisco; Ohio's Cincinnati, Cleveland and Columbus; and Florida's Miami and Tampa. Other markets in this category are Baltimore, Las Vegas, Raleigh/Durham, Seattle and Virginia Beach.
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Ten are expected to perform on par with the national average in terms of rent growth. They include Atlanta, Greensboro, Memphis, Nashville, Newark, Oakland, Orlando, Portland, San Diego and St. Louis.
Expected to rank below the median in 2025 are most of the nation’s gateway markets and four of the big Texas metros – Dallas, Fort Worth, Houston and San Antonio. After being downgraded by RealPage due to ongoing federal job cuts that are expected to weigh on the local economy, Washington, D.C., fell into the below-average category in the forecast. Other markets expected to underperform in rent growth are Charlotte, Fort Lauderdale, Jacksonville, Los Angeles, Minneapolis, New York, Sacramento and Salt Lake City.
Only three markets are expected to post rent drops during the year – Austin, Denver and Phoenix. These areas have been working to absorb big supply volumes recently, which have impacted occupancy rates, said RealPage.
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Kristen Smithberg
Kristen Smithberg is a Colorado-based freelance writer who covers commercial real estate, insurance, benefits and retirement topics for BenefitsPRO and other industry publications.
