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Apartment rent growth has been decelerating since peaking in March 2022, but recent data from RealPage shows that could be leveling off for at least the short term.

National effective asking rents inched up 0.16% year over year as of November compared with 0.08% the prior month, with change measured on a same-store basis. This marked the first time in 20 months that the pace of rent change didn’t decelerate.

According to RealPage, it expects rent growth to remain fairly flat through next year, with many markets posting cuts. These flattening rents also were in line with RealPage’s forecast heading into the winter months because of the base effect. Month over month, effective rents decreased 0.52% in November, compared with a 0.57% cut one year prior.

“One deep monthly cut is replacing another in the year-over-year calculation, creating the appearance of stability in the year-over-year rent metric,” noted RealPage. “The base effect will likely remain at play through the winter due to bigger than normal cuts over the same period last year, which could keep the headline rent metric pretty flat.”

While there’s ample demand for apartments, that is being overshadowed by the influx of supply coming online. According to RealPage, rents are falling most in markets adding the most supply, while the biggest gains are being seen in low-supply markets.

Occupancy continued to inch back in November, declining 0.9 points year over year to 94.2%. In November, 51.8% of renters with expiring leases signed renewals, which is down slightly from November 2022 but still high for the month of November.

More than 461,000 units are slated to be completed this year, followed by 670,000 in 2024. Completions are expected to decrease dramatically in the years following with new start levels dropping recently. According to RealPage, occupancy rates should rebound and rent growth should pick back up, although not to the levels seen during the pandemic.

Other key findings from the November report include:

  • Continued rent deceleration has been seen in Florida. While demand remains strong, it’s not enough to keep pace with the surging supply. Out of the 20 markets with the deepest rent cuts, eight are located in the Sunshine State. Effective rents, which include concessions, decreased around 5% to 6% year over year in Fort Myers, Sarasota/Bradenton, Jacksonville, and Daytona Beach. Orlando, Palm Bay/Melbourne, Fort Walton Beach, and Pensacola saw rents down 3% to 4% year over year;
  • Rent cuts topped 4% in Austin, Texas; Boise, Idaho; Atlanta; and Phoenix. The pace of change moderated a bit in these markets between October and November, “signaling that cuts aren’t going deeper—at least for now;”
  • Rents fell year over year in every major West Coast market, with the exception of San Diego and California’s Orange County;
  • Out of the nation’s top 150 metros, 41—primarily in the Midwest and Northeast where supply is limited—recorded rent growth of more than 3%; and
  • Among large markets, Chicago led the way for rent growth at 3.6%, followed by Northern New Jersey, Cincinnati, Milwaukee, Cleveland, Boston, Indianapolis, and St. Louis.