Rent Prices Increased for Fifth Consecutive Quarter in Q1 2022

According to data provided by the US Census Bureau’s Survey of Market Absorption of Apartments (SOMA), with additional analysis provided by the National Association of Home Builders (NAHB), the multifamily sector continued to experience growth in Q1 2022. The growth is due to ongoing strong demand and low vacancy rates. On the downside, the NAHB says, is the decline in the number of apartment and condominium completions, which reflects the ongoing supply chain challenges builders have been facing.

The absorption rate of unfurnished, unsubsidized apartments (the share rented out in the first three month following completion) increased 5 percentage points to a reading of 62% in Q1 2022, up from 57% in Q1 2021. On the other hand, the number of apartments completed was down during the same period, from 64,600 units in Q1 2021 to 52,520 units in Q1 2022—an approximately 16.0% decline.

Year-over-year the median asking rent for apartments increased from $1,768 in Q1 2021 to $1,832 in Q1 2022, or a 4% gain. This marks the fifth consecutive quarter with a year-over-year increase in median rent.