Multifamily advertised asking rents across the country increased $5 in March to $1,755, highlighting positive sector performance to start the spring leasing season, according to the Yardi Matrix March 2025 National Multifamily Report. Year-over-year advertised rent growth fell 20 basis points to 1%
The report said the rent increase through March was weaker than the typical first-quarter growth, but not by much. The difference is likely due to ongoing weakness in high-supply markets where rents are down year-over-year despite extremely strong demand.
Austin, Denver, Phoenix, and Nashville all saw rents drop over the past year as absorption levels were high. These markets added more than 5% to stock over the past year and will likely see similar delivery levels this year before dropping next year.
The report found solid performance in gateway markets, led by New York with 5.5% YoY growth and Chicago with 3.7% growth. San Francisco was the only gateway metro that logged rent growth below the national 1% average rate.
The national occupancy rate in February was 94.5%, unchanged for the past three months. Of the eight top 30 metros with increased occupancy rates over the past year, four are West Coast metros, including San Francisco, which benefits from low new supply and strong absorption. Demand in Los Angeles is higher due to residents displaced by wildfires. Portland and San Diego were among the eight top metros with increased occupancy rates.
Advertised rents were up 0.3% month over month across the country in March, with declines in six of the top 30 metros. Lifestyle rents grew 0.3% and renter-by-necessity (RBN) segment rents grew 0.2%.
Single-family build-to-rent advertised rates also increased strongly to $2,169, a $5 increase in March. Nationally, advertised rents are the same as a year ago, said Yardi. U.S. SFR occupancy was stable at 94.7%. Segment fundamentals remain healthy despite slowing rent increases, and demand is unlikely to waver while home ownership costs remain high, said the report.
The Midwest was the strongest region for SFR rent growth, with more than half of the top 10 metros in the category located there, including Kansas City, South Dakota, Detroit, Columbus, Minneapolis/St. Paul, and Chicago.
Predictions for 2025 remain uncertain as economic volatility characterizes the market due to tariffs, layoffs and lower consumer confidence, as well as a reduction in immigration. However, investors remain confident and multifamily capital markets are liquid, said Yardi Matrix.
“A large volume of multifamily loans are coming due in 2025, including many that were previously extended,” said the report. “Lenders are eager to remove such loans from their balance sheets, and they are likely to be tougher with borrowers than they were a year or two ago. That creates opportunities for investors to provide takeout financing or buy the loans from banks.”
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