{"id":5692,"date":"2023-02-23T13:11:23","date_gmt":"2023-02-23T13:11:23","guid":{"rendered":"https:\/\/www.yardimatrix.com\/blog\/?p=5692"},"modified":"2023-09-12T19:53:47","modified_gmt":"2023-09-12T19:53:47","slug":"national-multifamily-market-report-january-2023","status":"publish","type":"post","link":"https:\/\/www.yardimatrix.com\/blog\/national-multifamily-market-report-january-2023\/","title":{"rendered":"National Multifamily Market Report \u2013 January 2023"},"content":{"rendered":"<p><em>The annual U.S. multifamily rent growth continued to decelerate, up 5.5% in January, but the average remained unchanged from December, at $1,701.<\/em><\/p>\n<h2>Report highlights:<\/h2>\n<ul>\n<li>Multifamily rents remained flat at $1,701 in January, up 5.5% year-over-year; Occupancy declined but remained above the 95% mark.<\/li>\n<li>Increases in property taxes, financing costs and insurance are increasingly challenging for the multifamily market.<\/li>\n<li>Lifestyle rents remained flat, Renter-by-Necessity rates inched up 0.1% in January.<\/li>\n<li>SFR rents averaged $2,070 in January, up $1 from December.<\/li>\n<\/ul>\n<h2>Annual rent growth remains on softening trend<\/h2>\n<p>The new year started with the average asking rent <a href=\"https:\/\/www.yardimatrix.com\/blog\/national-multifamily-market-report-december-2022\/\"><strong>unchanged from December<\/strong><\/a>, at $1,701, which, for the middle of the typically slow winter season, is a positive sign. On a year-over-year basis, rent growth continued to decline, up just 5.5%, 70 basis points below December\u2019s rate. Indianapolis remained in the lead among Yardi Matrix\u2019s top 30 metros, up 10.5%, followed by San Jose (8.1%), Miami (7.5%) and Kansas City (8.3%). Smaller metros with solid performance include Albuquerque (10.2%), Northern New Jersey (7.9%), St. Louis (7.2%) and Salt Lake City (7.0%).<\/p>\n<p>Household formation slowed in 2022 compared to the previous year\u2014269,000 units were absorbed last year in the U.S., while deliveries surpassed 400,000 units. This has triggered a drop in occupancy, of 90 basis points year-over-year, to 95.3%. Metros with at least 10,000 units absorbed include Dallas, Houston, Austin, Washington, D.C., Atlanta, Chicago, Miami and Los Angeles. Metros ranking high in absorption on a percentage of stock basis are Nashville (5.0%), Austin (4.1%), the Twin Cities (3.3%), San Jose (3.1%) and Columbus (3.0%).<\/p>\n<p>Demand was healthy at the beginning of 2023, supported by the strong economy, which in January added 517,000 new jobs following nearly 5 million new jobs gained in 2022. Moreover, unemployment stood a 3.4% and wage growth shows no signs of stopping. Despite the robust demand, rent growth cannot maintain the level posted during the last two years. Additionally, the multifamily market faces new challenges, including rising property taxes, financing costs and insurance, and renovations related to climate change.<\/p>\n<p><iframe id=\"datawrapper-chart-VyJV3\" style=\"width: 0; min-width: 100% !important; border: none;\" title=\"Rent, Employment and Supply Growth\" src=\"https:\/\/datawrapper.dwcdn.net\/VyJV3\/1\/\" height=\"1332\" frameborder=\"0\" scrolling=\"no\" aria-label=\"Table\" data-external=\"1\"><\/iframe><script type=\"text\/javascript\">!function(){\"use strict\";window.addEventListener(\"message\",(function(e){if(void 0!==e.data[\"datawrapper-height\"]){var t=document.querySelectorAll(\"iframe\");for(var a in e.data[\"datawrapper-height\"])for(var r=0;r<t.length;r++){if(t[r].contentWindow===e.source)t[r].style.height=e.data[\"datawrapper-height\"][a]+\"px\"}}}))}();\n<\/script><\/p>\n<h2>Short-term rent gains in gateway markets<\/h2>\n<p>On a month-over-month basis rent growth was flat in January. Renter-by-Necessity rents rose slightly (0.1%), while Lifestyle rates remained unchanged. Of Yardi Matrix\u2019s top 30 metros, 14 saw rent gains and 16 registered rent declines. Leaders in increases were Boston (0.9%), Miami (0.6%), Chicago and New York (both 0.5%) and Philadelphia and Los Angeles (both 0.4%), as demand for housing strengthened as a result of a rebound in immigration and a steady return to the office. At the other end of the spectrum there were metros such as Las Vegas (-0.5%), Sacramento, Austin, San Jose, the Inland Empire and Washington, D.C. (all -0.4%).<\/p>\n<p>Renewal rents rose 19.2% year-over-year through November, down 160 basis points from the previous month. As the rate reflects the process of property owners bringing existing tenants up to the level of asking rents, it is likely that growth will continue to decelerate. Tampa (16.9%), Orlando (14.6%) and Charlotte (14.5%) led ranks. National lease renewal rates stood at 61.1% in November, down from 64.9% in October and the lowest level since before the pandemic. The decline could mean that tenants are shopping around for lower rents.<\/p>\n<h2>Single-family sales rebounding, BTR fuels SFR growth<\/h2>\n<p>The asking rent for SFRs increased 4.2% year-over-year in January, to $2,070, down 80 basis points from December. Occupancy declined 1.2% year-over-year through December, to 95.9%.<\/p>\n<p>The single-family home sale market is slightly improving from the weak performance registered during the final part of 2022. Still, the SFR segment benefited from the moderation in sales, and now that those are recovering, the growth of single-family rentals comes mainly from build-to-rent communities. In 2022, 13,800 SFRs were delivered in communities of 50 units or more, according to Yardi Matrix\u2019s SFR database.<\/p>\n<p>Read the full <a href=\"https:\/\/www.yardimatrix.com\/publications\/download\/file\/3363-MatrixMultifamilyNationalReport-January2023\" target=\"_blank\" rel=\"noopener\"><strong>Matrix Multifamily National Report-January 2023<\/strong><\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>The annual U.S. multifamily rent growth continued to decelerate, up 5.5% in January, but the average remained unchanged from December, at $1,701. Report highlights: Multifamily rents remained flat at $1,701 in January, up 5.5% year-over-year; Occupancy declined but remained above the 95% mark. Increases in property taxes, financing costs and insurance are increasingly challenging for [&hellip;]<\/p>\n","protected":false},"author":753,"featured_media":5693,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[5,13,4],"tags":[],"class_list":["post-5692","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-multifamily-market","category-national-reports","category-real-estate-trends"],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v23.4 (Yoast SEO v24.6) - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>National Multifamily Market Report \u2013 January 2023 - Yardi Matrix Blog<\/title>\n<meta name=\"description\" content=\"The annual U.S. multifamily rent growth continued to decelerate, up 5.5% in January, but the average remained unchanged from December.\" \/>\n<meta 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