Rents have risen 8% since the start of the year, and the average rent rose by $26 in July to $1,510.
Multifamily asking rents rose by 8.3% year over year in July, breaking records again for rent growth in this month’s Matrix Multifamily National Report. Rents have risen by 8% since the start of the year, and the average rent rose by $26 in July to $1,510.
This meteoric rent spike speaks to a growing demand for multifamily across the country, as supported by the performance of many publicly traded REITs. According to Yardi, REITs concentrated in the Sun Belt are showing even higher gains. Of the 140 metros covered by Yardi Matrix, 129 showed positive YOY rent growth.
Out of the top 30 markets, 13 experienced double-digit asking rent growth YOY. Phoenix led the way at 18.9%, followed by Tampa, Florida, at 16.4% and Las Vegas at 16.1%. Only three markets experienced negative growth YOY—San Francisco at -0.5%, San Jose, California, at -0.7%, and New York at -0.8%. However, with these markets on their way to recovery, Yardi anticipates positive rent growth as soon as next month.
Rents rose by 1.8% on a month-to-month basis from June to July, and 26 out of the top 30 metros experienced rent growth of 1% or higher month to month; San Jose led the list at 3.6%—the strongest month for the city since the start of the COVID-19 pandemic—followed by Raleigh, North Carolina, at 3.5% and Boston at 3.2%.
Gateway market performance is much stronger in the short term than the long term. Month to month, rents rose 3% in New York and 1.8% in San Francisco. If recent trends continue, Yardi anticipates that rents in both markets could return to 2019 levels this year.
Occupancy rose to 95.3% in June, up 0.6% from one year ago. (Occupancy data is current to the previous month.) The National Multifamily Housing Council’s Rent Payment Tracker has shown consistent collections throughout the pandemic, with 95.6% of multifamily households making a full or partial rent payment in June.
Single-family rents rose 12.8% on a year-over-year basis in July, while occupancy rose 1.2% over the same period. All of the top 30 metros experienced positive rent growth, and 19 out of 30 saw growth in the double digits.
Tampa led the way with 31.7% YOY rent growth, followed by Miami at 26.3% and Phoenix at 24.2%. Twenty-six out of the top 30 metros saw occupancy gains, led by Indianapolis at over 6%.