Multifamily Rents Hit New Peak (But Growth Is Slowing)
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The latest monthly Yardi Matrix report reveals that average US apartment rents hit a new high in February, rising $7 to $1,175 per month.
However there are indicators that the market will return to more normal growth. February rents were up a solid 5.9% year-over-year, but down from 6.4% a month earlier, GlobeSt reports.
The 50 basis point drop is partially due to such strong gains in February 2015, when rents leapt 1% from the month prior. But, some areas have had declining growth in more recent months.
In tech-centric metro areas like Portland, San Francisco, and Denver, growth is at, or near the top, in year-over-year rankings, but it has been trailing in the past three months.
The report notes that this could be because the tech sector has cooled off with layoffs and cancelled IPOs. The energy sector is getting hit as well, with the price of crude oil hovering near $30 a barrel, impacting metros like Houston, Denver and Pittsburgh.
Nonetheless, with year-over-year rent increases near 6%, there's likely little cause for concern; Yardi predicts rent growth this year will land close to the projected 4.5% increase. [GS]