U.S. Rent Growth Continues to Slows as More Multifamily Rental Units are Completed

Apartment List.com recently released its October 2024 National Rent Report. The national median rent dipped by 0.5% in September. The median rent nationally now stands at $1,405, and Apartment list believe that we’re likely to see that number continue to dip modestly through the remainder of the year.

After bottoming out in October 2021, apartment vacancies have been opening up steadily for over two years. As of September, the vacancy index sits at 6.7%, the highest level since August 2020. And there’s reason to expect that it could rise even further during the remainder of the year. Despite a recent slowdown in new building permits being issued and new construction projects breaking ground, the number of multifamily units under construction remains near record levels. 2023 saw the most, new apartments complete construction in more than 30 years, and an even greater number of new units are expected to come on the market this year. This means that renters should have more available options than they have in some time, especially in the Sun Belt markets where construction activity has been strongest.

Of note, since the second half of 2022, the seasonal declines in rent prices that take place during the fall and winter have been steeper than usual and seasonal increases of the spring and summer have been milder. As a result, apartments are on average slightly cheaper today than they were one year ago. Year-over-year rent growth nationally currently stands at 0.7% lower and has now been in negative territory for over a year and a half. Despite this, the national median rent is still more than $200 per month higher than it was just a few years ago.

On the supply side of the rental market, the Apartment List’s national vacancy index remains slightly elevated, currently standing at 6.7%. After a historic tightening in 2021, multifamily occupancy has been slowly but consistently easing for over two years.