Multifamily rent growth remains tepid as the market continues to seek a balance between robust demand and supply, while economic uncertainty is high. The average U.S. advertised rent increased $3 to $1,749 in June, representing year-over-year growth of 0.9%, according to Yardi Matrix’s June 2025 national multifamily report.
Rent growth was strongest in the Midwest, led by Chicago at 3.6%, Columbus at 3.3%, Kansas City at 3.2% and Detroit at 2.9%. Meanwhile, advertised rent remained in negative territory in many Sun Belt and Mountain West metros, such as Austin at -4.7%, Denver at -3.9%, Phoenix at -2.6%, and Orlando and Dallas, both at -1.2%.
For the quarter, advertised rents rose 0.7% and for the first half of 2025, they increased 1.2%, or $20. Both of these marks are well shy of pre-pandemic growth rates, the report said. Advertised rents grew an average of 1.8% during the second quarter and 2.4% during the first half of the years between 2013 and 2019.
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“While demand remains healthy, rent growth is muted by economic uncertainty and rapid supply growth in many markets,” the report said.
“Rents in the first half of 2025 grew by about half of the rate in the pre-pandemic cycle.”
Full-year rent growth is likely to be tepid for 2025 because seasonal growth is typically concentrated in the first two quarters, said Yardi Matrix. However, the report noted that even modest growth amid record deliveries over the past two years signals resilient demand. More than 250,000 apartment units were absorbed through May, led by Austin with 22,000 units and Sun Belt markets including Charlotte, Nashville, Raleigh-Durham and Orlando. Demand also remains high in the Midwest, particularly Indianapolis.
The national occupancy rate held steady at 94.6% in May, down 0.2% year-over-year but unchanged over the past seven months. Strong demand has helped stabilize the category despite elevated supply, with only a few markets experiencing significant changes in occupancy, said the report. Chicago posted the largest increase in occupancy at 0.4% year-over-year, while Denver’s occupancy dropped 1% and Phoenix's occupancy slipped 0.6%.
“No other metro shifted by more than 0.3%, which is impressive given that completions exceeded 4% of total stock in a third of the top 30 metros,” said Yardi.
Advertised rates for single-family build-to-rent increased by $4 to $2,201 in June, a 0.7% annual increase and growth of 0.8% for the first half of the year. Yardi characterized this growth as positive but subdued compared to recent years.
The data and research firm highlighted legislative wins that emerged during the month. California passed a law to limit costly, time-consuming environmental reviews, which should accelerate project entitlements and help streamline the development process. In addition, the new federal tax bill is positive for affordable housing, with a 12.5% increase in federal funds for Low-Income Housing Tax Credits (LIHTC) that will increase the size of the program to $14 billion.
Potential headwinds in the multifamily market include slowing job growth and uncertainty surrounding tariff and immigration policies, said the report.
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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.
