Multifamily rents rose by 1.6% year over year in April, according to Yardi Matrix’s latest Multifamily National Report—the largest YOY rent growth the market has seen since the start of the COVID-19 pandemic. On a month-to-month basis, overall rents rose by $10 to $1,417 in April, marking the sharpest overall rent increase since June 2015.
Twenty-one out of the top 30 metros experienced positive YOY rent growth in April. California's Inland Empire has experienced the strongest YOY rent growth at 9.4%, almost to double digits, followed by Sacramento at 8.4% and Phoenix at 8.1%. New York remains at the bottom at -12.6%, along with other gateway markets like San Jose, California (-10.8%), and San Francisco (-7.7%), though monthly gains suggest a coming rebound.
Strong markets like the Inland Empire have only gotten stronger, while markets that have struggled during the pandemic have begun the process of recovery. Rents in the Inland Empire have grown by 31% over the past five years, while rents in Sacramento and Phoenix have risen 34% over the same period, compared with 12% rent growth nationwide.
Out of the top 30 markets, 24 experienced month-to-month rent growth greater than 0.5%, led by Las Vegas at over 1%. All gateway markets posted positive gains; Miami leads rent growth in the gateway markets at 1% on a month-over-month basis, followed by Chicago at 0.9%, Boston and San Francisco at 0.8%, and New York at 0.6%.
According to a study of Yardi Matrix data, one out of every 14 multifamily properties in the U.S. has seen occupancy drop by 5% or more in the last 12 months. Many of these properties are concentrated in urban gateway metro centers, with the most severe observed in New York City, San Jose, and Los Angeles. In New York City, 32.6% of multifamily properties saw a 5% decline, while 9.8% saw a decline of 10% or more. A large number of these declines were located in Manhattan. Yardi Matrix forecasts that it could take at least three years for major gateway markets, including New York, to recover to pre-pandemic occupancy levels.
