Multifamily conditions remain soft, with year-over-year rent growth still negative and vacancies and time-on-market continuing to inch higher. The wave of construction that has driven these trends is waning, but near-term conditions will depend on rental demand, which has grown shakier amid weakness in the labor market and general economic uncertainty.
The national median apartment rent fell 0.2% in January to $1,353, marking the sixth consecutive month of declines, according to Apartment List's February national rent report. This winter dip, while modest, is the smallest since August, suggesting the market may be exiting the off-season and could return to positive growth in the coming months. Apartment List noted a shift in the timing of rental seasonality over the past three years as March has emerged as the peak month for rent growth, replacing May, and downward pressure on rents now often begins in August rather than September.
Nationally, rents are down 1.4% compared with a year ago, the lowest year-over-year growth recorded since August 2023. Rents have been slightly negative for more than two years, leaving the national median 6.2% below its 2022 peak. Despite this pullback, current rent levels remain 18% higher than at the end of 2020.
The national multifamily vacancy rate reached a record 7.3%, fueled by a historic surge of construction. About 500,000 units were built last year, down from more than 600,000 in 2024. "We're past the peak of the multifamily construction surge, but a healthy supply of new units is still hitting the market and colliding with sluggish demand, causing vacancies to continue trending up," Apartment List said.
Soft demand is reflected in leasing activity, with units taking an average of 41 days to lease, four days longer than a year ago and a record high since 2019. By comparison, summer 2021 units turned over in just 18 days.
Rent trends vary regionally, with annual declines concentrated in the South and Mountain West, while many markets in the Northeast, Midwest and parts of the West Coast continue to see rising rents despite the winter slowdown. Austin continues to have the softest conditions among large rental markets, with the median rent down 6.3% year over year. At the other end of the spectrum, Virginia Beach now ranks as the fastest-growing metro, with year-over-year rent growth of 5%.
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