{"id":6586,"date":"2023-11-16T09:53:20","date_gmt":"2023-11-16T09:53:20","guid":{"rendered":"https:\/\/www.yardimatrix.com\/blog\/?p=6586"},"modified":"2024-03-12T15:48:46","modified_gmt":"2024-03-12T15:48:46","slug":"national-multifamily-market-report-october-2023","status":"publish","type":"post","link":"https:\/\/www.yardimatrix.com\/blog\/national-multifamily-market-report-october-2023\/","title":{"rendered":"National Multifamily Market Report \u2013 October 2023"},"content":{"rendered":"\n<p class=\"has-normal-font-size\">Read the latest Yardi Matrix <strong><a href=\"\/blog\/national-multifamily-market-report\/\">National Multifamily Market Report<\/a><\/strong>.<\/p>\n\n\n<hr \/>\n<p><em>Rents drop for the second consecutive month, down $3 to $1,718 in October, with year-over-year growth softening to 0.4%.<\/em><\/p>\n<h2>Report highlights:<\/h2>\n<ul>\n<li>The average U.S. asking rent increased just 0.4% year-over-year through October, <a href=\"https:\/\/www.yardimatrix.com\/blog\/national-multifamily-market-report-september-2023\/\"><strong>down 40 basis points from September<\/strong><\/a>.<\/li>\n<li>Tepid rent growth in metros in the Northeast and Midwest is annulled by modest decreases in metros in the Sun Belt and West.<\/li>\n<li>Renter-by-Necessity rents remained unchanged, but Lifestyle rents continued their descent, down 0.4%.<\/li>\n<li>Rent growth in the single-family rental segment rose 1.0% year-over-year in October, to $2,121.<\/li>\n<\/ul>\n<h2>Supply expansion hinders rent growth<\/h2>\n<p>The average U.S. multifamily asking rent was up 0.4% year-over-year through September, to $1,718, a 40-basis-point and $3 drop from September. It also marked the second consecutive month of decline. Growth was led by metros in the Northeast and Midwest\u2014New York City (5.8% year-over-year), New Jersey (4.1%), Columbus (3.5%), Chicago (3.2%) and Kansas City (3.0%). Yet, 14 of Yardi Matrix\u2019s top 30 markets recorded negative rent growth on an annual basis. Most of these are located in the Sun Belt, where supply has been robust and rents have increased substantially in recent years.<\/p>\n<p><iframe id=\"datawrapper-chart-jd87B\" style=\"width: 0; min-width: 100% !important; border: none;\" title=\"Top 10 Markets for YoY Rent Growth\" src=\"https:\/\/datawrapper.dwcdn.net\/jd87B\/2\/\" height=\"511\" frameborder=\"0\" scrolling=\"no\" aria-label=\"Table\" data-external=\"1\"><\/iframe><script type=\"text\/javascript\">!function(){\"use strict\";window.addEventListener(\"message\",(function(a){if(void 0!==a.data[\"datawrapper-height\"]){var e=document.querySelectorAll(\"iframe\");for(var t in a.data[\"datawrapper-height\"])for(var r=0;r<e.length;r++)if(e[r].contentWindow===a.source){var i=a.data[\"datawrapper-height\"][t]+\"px\";e[r].style.height=i}}}))}();\n<\/script><\/p>\n<p>Demand for apartments endured, with more than 250,000 units absorbed during the first three quarters of 2023, in line with the 300,000-unit volume absorbed annually between 2017 and 2020. Meanwhile, the national occupancy rate posted its first decline in four months, to 94.9% in September. The rate remained positive in just four of Yardi Matrix\u2019s top 30 metros: Chicago (0.5%), Denver (0.3%), New York (0.1%) and Seattle (0.1%). Another six metros posted occupancy declines of 1.0% or more, led by Atlanta (down 1.3%).<\/p>\n<h2>Lifestyle rents drop, RBN stay unchanged<\/h2>\n<p>On a month-over-month basis, national rents fell 0.2% in October, down 0.4% in the Lifestyle segment and flat in the Renter-by-Necessity segment. Lifestyle rents contracted in 27 of the top 30 metros and RBN rents in only 15. Weak rent performance was registered in Austin (down 1.2% in Lifestyle and 0.7% in RBN) and Orlando (down 0.8% in Lifestyle and 0.5% in RBN). More so, gains in overall month-over-month rents were recorded just in New Jersey (0.2%), Kansas City (0.2%) and New York (0.1%). Although rent declines were registered in markets with robust supply, such as Austin, Phoenix, Orlando, Raleigh, Charlotte and Nashville, absorption remained strong.<\/p>\n<p>Renewal rent growth decelerated further, up 5.9% nationally year-over-year through August. Expectedly, most of the metros with the highest renewal rents were markets with rising asking rents. Among them were New York (11.0%), Boston (9.2%), Indianapolis (8.6%), Kansas City (8.5%) and New Jersey (7.2%). Metros with weak renewal rent growth were San Francisco (-5.0%), Phoenix (3.5%) and Seattle (4.4%). Meanwhile, national lease renewal rates averaged 64.4% in August, having settled in the 64.4% and 65.0% range in the last five months. The highest rates were in New Jersey (81.3%) and the lowest in San Francisco (48.2%).<\/p>\n<h2>SFR operators fixate on operational efficiency<\/h2>\n<p>The average asking rent for SFRs fell $2 in October to $2,121, a 1.0% year-over-year increase. Occupancy inched up 10 basis points to 95.9% in September. SFR operating expenses marked a 12.2% increase on a trailing 12-month basis through September, averaging $9,149 per unit. Hence, operators are focusing on reducing costs. The biggest expense increases were recorded for marketing (up 29.1%), insurance (23.4%) and repairs and maintenance (19.6%). To put things into perspective, maintenance costs account for roughly 17% of total expenses, and insurance for 5%, but it\u2019s growing fast, especially in metros located in areas prone to natural disasters.<\/p>\n<p>Read the full <strong><a href=\"https:\/\/www.yardimatrix.com\/publications\/download\/file\/4775-MatrixMultifamilyNationalReport-October2023\">Matrix Multifamily National Report-October 2023<\/a><\/strong>.<\/p>","protected":false},"excerpt":{"rendered":"<p>Rents drop for the second consecutive month, down $3 to $1,718 in October, with year-over-year growth softening to 0.4%. Report highlights: The average U.S. asking rent increased just 0.4% year-over-year through October, down 40 basis points from September. Tepid rent growth in metros in the Northeast and Midwest is annulled by modest decreases in metros [&hellip;]<\/p>\n","protected":false},"author":748,"featured_media":6592,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[5,13,4],"tags":[475],"class_list":["post-6586","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-multifamily-market","category-national-reports","category-real-estate-trends","tag-multifamily-outlook-2023"],"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 October 2023 - Yardi Matrix Blog<\/title>\n<meta name=\"description\" content=\"Rent growth was slightly negative in October, as strong supply growth eroded rent gains in many Sun Belt 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