Across pockets of the country often overlooked by large institutional investors, rents are quietly heating up again. Apartments.com data reveal ten smaller markets where multifamily rent growth is outpacing national averages, driven by steady demand and restrained supply—a combination that National Director of Multifamily Analytics Grant Montgomery calls the formula for resilience in today’s uneven housing landscape.
“Across all of these markets, the theme starts with demand,” Montgomery tells GlobeSt.com. “While the micro markets vary widely, every one of them shares a strong demand driver—whether that’s a university, a major employer, or spillover from a larger city.”
Those forces have pushed rents higher in places like Lancaster, Pennsylvania, where asking rents climbed more than 6 percent over the past year. The city’s growing employment base in healthcare and manufacturing, coupled with limited multifamily construction, has kept vacancy rates below 4 percent. Similarly, Fayetteville, Arkansas, buoyed by the expanding University of Arkansas and the corporate presence of Walmart and Tyson Foods, has seen rents jump 5.8 percent year over year.
In Hartford, Connecticut, CoStar data show a 5.4 percent annual increase in average rent—an exceptional pace for a market long considered stable but stagnant. Downtown office conversions and rising demand from young professionals priced out of Boston and New York have changed the complexion of the city’s rental inventory. Montgomery notes that while such smaller metros differ from the Sun Belt cities that dominated headlines during the last cycle, they share an underlying balance between new supply and household formation. “Markets that are outperforming now tend to have moderate construction pipelines,” he said. “That’s what allows demand to show through in rent growth.”
The pattern extends to Scranton, Pennsylvania, and Toledo, Ohio, both of which have logged roughly 5 percent rent gains. Population growth in each is marginal, but their affordability compared with nearby metros—Philadelphia and Detroit, respectively—has brought in new renters, particularly remote workers seeking lower costs. Albany, New York, benefits from a steady state government workforce and spillover demand from the New York City region, producing rent increases of 4.9 percent amid a modest supply pipeline.
Southern markets appear in the mix as well. Baton Rouge, Louisiana, posted rent growth of 4.7 percent—supported by stable job creation in the petrochemical and healthcare sectors and subdued new construction after several years of heavier deliveries. In Springfield, Missouri, rents have surged 4.5 percent, sustained by the area’s expanding health sciences cluster anchored by CoxHealth and a rising inflow of retirees drawn by affordability. Meanwhile Greenville, South Carolina, logged one of the largest gains at 6.3 percent, reflecting in-migration from larger Southeastern metros and an influx of manufacturing jobs led by BMW and Bosch expansion projects.
The westernmost entry, Boise, Idaho, stands out for its recovery following a steep correction in 2022. Rents there have rebounded 5 percent as construction slowed and population growth resumed, primarily from California transplants seeking a lower cost of living. The city’s tighter vacancy levels show how swiftly markets can turn when supply pipelines recalibrate.
Montgomery emphasizes that these examples illustrate a broader national story. “Even as many Sun Belt cities deal with a supply overhang and slower rent growth, there are numerous smaller markets where conditions remain strong,” he said. “What we’re seeing is a segmentation of performance—local economies with balanced pipelines and durable demand engines are leading rent growth.”
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