The start of 2026 marks a rebound for multifamily rent growth after five consecutive months of rate depreciation.
Highlights:
- The average U.S. advertised asking rent increased $3 to $1,741, marking a 0.2% increase year-over-year.
- Monthly growth mirrored yearly growth at 0.2%, with more than half of Matrix’s top 30 markets posting gains.
- Last year, 519,000 apartments were absorbed, marking 2025 as the third-best showing of the past decade.
- SFR-BTR average advertised rents declined $2 to $2,184 in January, representing a 0.9% drop year-over-year.
New year, new multifamily rental performance
At the end of January, national multifamily average advertised asking rents rebounded, increasing $3 to $1,741, marking a 0.2 percent growth year-over-year. This increase put a stop to a consecutive five-month streak of rent decreases. The usual Midwest and coastal markets posted gains, with Chicago leading annual rent growth (3.6%), followed by New York City (3.3%), the Twin Cities (2.7%), and Kansas City (2.5%), as well as San Francisco (2.0%). Supply-burdened metros such as Austin (-5.0%), Phoenix (-3.7%), Denver (-3.2%), Tampa (-3.0%) and Las Vegas (-2.8%) continued showing negative rent growth.
Short-term and long-term growth rates converged at 0.2% each, with more than half of the top 30 Yardi Matrix markets registering monthly improvements. Metros across the coastal and Midwest regions posted the strongest gains, including Seattle, Chicago and New Jersey (0.6% each). Rental performance declined throughout Sun Belt markets such as Tampa (-0.8%), Austin and Houston (-0.3% each). A clear divide between the rate growth of Renter-By-Necessity and Lifestyle properties emerged in certain markets. For instance, Detroit skewed toward an increase in the rent of its RBN stock and a depreciation of the Lifestyle pricing, which suggests a potential trade down from renters amid affordability concerns. Conversely, San Diego posted uneven rent growth favoring Lifestyle properties, a phenomenon likely pointing to a strong income demographic and limited new supply.
The average national occupancy rate slid down 10 basis points year-over-year to 94.5 percent in December. However, last year’s delivery count of 590,000 units nearly doubled the pre-pandemic average of 317,000, dating back to 2013. Supply-heavy metros across the Sun Belt had some of the lowest occupancy rates, including Houston (92.2%), Austin (92.3%) and Dallas (92.9%). Meanwhile, a few of the markets that moved the needle in a positive direction were Atlanta (0.6% occupancy growth), the Twin Cities (0.3%) and San Francisco (0.2%).
Multifamily absorption, despite posting solid figures, raises concerns
Last year witnessed 590,000 deliveries and 519,000 absorptions, ranking 2025 as the third-highest absorption year of the past decade. However, the figure began tapering off during the later part of the year, with a difference of more than 50% between 2025’s first half and second half. What’s more, the second quarter’s figure is 80% higher than the fourth quarter’s value. For reference, that index averaged 31% during the past decade, aligned with seasonal variance. A prevailing concern is that this steeper drop in absorption reflects broader economic trends, including immigration policy and weak job growth, that pressure household growth and may keep demand weak. Still, absorption was strong across high-growth Sun Belt metros, including Austin (7.5% of stock absorbed in 2025), Charlotte (7.4%), Raleigh-Durham (6.0%) and Nashville (5.6%), as well as Phoenix (5.3%).
The average single-family build-to-rent rate ticked down $2 to $2,184 in January, marking a 0.9% decline year-over-year. Occupancy rates remained unchanged at 94.9 percent in December. A recent White House executive order aims to aid affordability concerns by banning institutional investment across single-family homes. Yet, such measures might lead to the opposite effect as institutional investors tend to expand the rental inventory and place downward pressure on both rents and for-sale home prices. Markets with solid investor presence that reflect this dynamic include Tampa (-2.7% SFR rent growth, -2.1% median home sale price, according to Redfin), Houston (-1.2%; -5.4%) and Atlanta (-0.5%; -5.7%). Conversely, metros where institutional investment is lacking, such as the Twin Cities (7.2%; 9.2%), Chicago (6.7%;4.3%) and South Dakota (2.0%; 4.7%), registered yearly increases in SFR rents and home prices.
Read the full Yardi Matrix Multifamily National Market Report: January 2026.
Add Comment