U.S. apartment markets are beginning to show renewed pricing power, but only in places where new supply has remained in check.
After several quarters dominated by a surge of deliveries, a clearer divide is emerging between markets still working through elevated construction pipelines and those where limited new supply is allowing landlords to push rents higher, according to Berkadia Research. That divergence is increasingly shaping performance across the multifamily sector.
In supply-constrained markets, operators are regaining leverage. Chicago posted some of the strongest rent growth in the country, with effective rents rising 6.4% year-over-year to $2,240 and occupancy reaching 96.3%. Net absorption exceeded new supply, reinforcing the idea that a thinner development pipeline can translate into stronger pricing. Philadelphia followed a similar pattern, with rents climbing 4% to $1,928 and occupancy rising to 96.1% as demand slightly outpaced deliveries.
Other lower-supply or high-demand markets are also holding firm. South Florida and Kansas City, for example, continued to register modest rent growth with stable occupancy, suggesting that even moderate construction levels are not enough to disrupt landlord pricing in fundamentally healthy markets.
That pricing strength stands in contrast to conditions in the nation's most supply-heavy metros, where rent growth remains under pressure despite solid leasing activity.
Austin illustrates the challenge. Developers delivered 17,801 units over the trailing four quarters, while net absorption reached 16,630 units. Even with demand keeping pace, the sheer volume of new supply pushed effective rents down 2.9% year-over-year to $1,597 and dragged occupancy to 91.9%. Phoenix showed a more balanced trajectory, with deliveries and absorption both near 21,500 units. Occupancy edged up 40 basis points to 94.4%, but rents still fell 2.8% year-over-year, indicating that pricing power has yet to fully recover.
Dallas-Fort Worth reflects a middle ground. The market absorbed approximately 25,000 units against nearly 30,600 deliveries, supported by strong household formation growth of nearly 45,000 units. Even so, rent growth remained muted, slipping just 0.4% to $1,483, while occupancy eased to 93.2%. Scale and population growth are helping stabilize fundamentals, but not yet enough to drive meaningful rent acceleration.
Nationally, the sector is moving toward equilibrium. Nearly 303,400 units were absorbed over the trailing four quarters, while deliveries declined 36.7% year-over-year to roughly 366,800 units. Effective rents rose 1.7% to $1,864 per month and occupancy held near 94.9%.
The broader takeaway is that stabilization is underway, but it is not uniform. Markets that avoided the most aggressive construction cycles are already seeing pricing power re-emerge, while oversupplied metros are still in a period of digestion. As the development pipeline continues to thin, that gap could narrow, setting the stage for a more synchronized recovery in rent growth.
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