After a decade of steady rent growth and surging demand for apartments, the U.S. multifamily market has hit a sudden and decisive slowdown. For the first time in more than ten years, asking rents have fallen, according to RealPage, reflecting a sharp pullback in leasing activity and a shift in the balance between supply and demand.
The cooling comes after a historic run. In the 12 months ending in the second quarter of 2025, net absorption reached an unprecedented 784,900 market-rate units, capping nine consecutive quarters of growth. But by the end of the third quarter, annual absorption had slipped to 637,100 units — still nearly twice the ten-year average, but a clear deceleration. The nation’s apartment inventory expanded by 2.4% over the past year, RealPage reported.
Carl Whitaker, chief economist for RealPage, attributed the slowdown primarily to what he described as “sluggish new lease activity,” suggesting broader macroeconomic pressures, including a weakening labor market, were weighing on demand. The combination of softer leasing and an ongoing influx of new supply has begun to tip the market toward higher vacancy and rent cuts.
Quarterly, the shift is even starker. In the three months through September, just 42,436 units were absorbed, while 105,525 new units hit the market. Over the past year, more than 474,800 new apartments have been delivered, following a peak of 586,151 units in the fourth quarter of 2024. National occupancy fell to 95.4% in Q3, down 30 basis points from the prior quarter, with regional rates ranging from 92.2% in the Midwest to 96.8% in the Northeast.
The supply surge stems from years of aggressive construction, especially in fast-growing Sun Belt metros that drew significant population inflows during the pandemic era. While completions have slowed somewhat, they remain elevated, and in many metros, new inventory is now outpacing leasing demand. The result has been a measurable increase in vacancy rates and the first rent declines since the aftermath of the Great Financial Crisis.
Between July and September, average asking rents fell 0.3% from the previous quarter — the first summer drop since 2009. Year-over-year, rents were down 0.1% at the end of Q3. Concessions have also become more common, with 22% of units offering an average discount of 6.2%, according to RealPage. With demand slowing, operators may have to lean more heavily on incentives to fill units.
The deepest declines over the past year occurred in markets that saw rapid development during the boom. Denver-Aurora-Centennial, Colo., posted the sharpest drop at 7.7%, followed by Austin-Round Rock-San Marcos, Texas, down 7.5%, and Phoenix-Mesa-Chandler, Ariz., down 5.3%. Other metros with notable yearly rent cuts include San Antonio, Texas (-4.9%); Las Vegas (-3.8%); Orlando (-3.4%); Dallas (-3.2%); Nashville (-2.6%); Charlotte (-2.4%); and Jacksonville, Fla (also down 2.4%).
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