In a sign the multifamily market is stable, national asking rents posted their first increase in seven months. According to the latest Yardi Matrix National Multifamily Report, the average U.S. asking rent increased $1 to $1,713 in February, a 0.6% year-over-year increase.
The national occupancy rate decreased 60 basis points year over year to 94.5% as of January after peaking at 96.2% in late 2021. According to Yardi Matrix, occupancy rates will likely slide further, particularly in markets that are seeing large numbers of units under construction.
Markets in the Northeast and Midwest continue to see rent gains versus the contractions being experienced in high-supply Sun Belt markets. Of Yardi Matrix’s top 30 metros, 13 saw rent declines, with five down 3% or more year over year.
New York City leads the list for year-over-year rent growth in February at 5.6%, followed by New Jersey at 3.8% and Columbus, Ohio, at 3.6%. Austin, Texas, posted the largest decline at 6.2%.
“While high-demand markets are likely to record weak rent growth over the next year or two, the seeds of a rebound have been planted, as starts are declining and deliveries will drop in 2026 and 2027,” noted Yardi Matrix analysts.
Month over month, rents were up 0.1% in the renter-by-necessity segment and unchanged in the luxury lifestyle segment. Rent growth was negative in 13 of the top 30 metros in the lifestyle segment and in eight in the renter-by-necessity segment. The most significant declines for both segments were in Austin, down 0.6% in lifestyle and 0.4% in renter-by-necessity, and Raleigh, North Carolina, down 0.5% in lifestyle and 0.4% in renter-by-necessity.
In January, the national lease renewal rate averaged 64.8%, falling below 65% for the first time since July 2021. Renewal rents decreased to 4.6% nationally year over year in January, down 20 basis points from December. Boston saw the highest year-over-year renewal rent growth at 9.5%, followed by Miami at 8.3% and Kansas City, Missouri, at 8%. Austin and New York were the only two markets with negative renewal rent growth at -1.2% and -1%, respectively.
On the single-family rental (SFR) side, asking rates decreased $2 in February to $2,133, with year-over-year growth falling 50 basis points to 1.2%. SFR occupancy rates were unchanged in January at 95.6%.
Boston and Raleigh continued to see the highest year-over-year growth in February, while Orlando, Austin, Phoenix, and Tampa, Florida, came in at the bottom of the list.
“SFR fundamentals remained rock solid in February, as demand is boosted by high mortgage rates and the ongoing lack of inventory in the for-sale market,” noted Yardi Matrix.
