After a steady first quarter, Albuquerque’s multifamily market may soon face pressure on key fundamentals as new supply continues to enter the market.
In the first three months of 2025, occupancy stood at 95.3%, about 20 basis points below the fourth quarter of 2024, according to a Colliers market report. The occupancy rate remains stable overall: Albuquerque ranked 63rd out of the top 150 U.S. markets and improved by 1.7 percentage points during 2024. The city also holds the 17th highest occupancy rate among Western markets.
However, the influx of new supply is a growing concern. In the first quarter alone, 1,459 new apartments were delivered, increasing existing inventory by 2.6%. Even more multifamily units are expected to come online in the near term, which could further test the market’s ability to absorb new product and may lead to a modest rise in vacancy rates as the market digests this elevated supply.
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"At the end of the first quarter 2025, 993 units were under construction, of which 911 are scheduled to complete in 2025," Colliers said.
The largest projected development set to deliver in 2025 in the city is MultiGreen Properties' 248-unit site in the West Mesa submarket.
As more supply enters the market, Colliers projects that occupancy by the first quarter of 2026 will drop to about 94.1 percent. So this will be a trend to watch in the coming months.
Another big highlight in the first quarter was that sales volume was nearly cut in half from the previous three months' almost $200 million in sales. And the amount was down by threefold compared with the first quarter of 2024's nearly $400 million in volume. One major first-quarter sale was Dominion buying a 288-unit property for $22.8 million.
As far as rents go, they were up 1.5 percent annually, but still well below the city's five-year average of 7.6 percent. Colliers forecasts that rent growth will remain below five percent at least until the first quarter of 2026.
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