Located on the side of the building at Hell’s Kitchen in New York City, signed apartments are available for rent through a real estate broker.
Deb Cohn-Orbach | ucg | Universal Image Group | Getty Images
A massive surge in new apartment supplies over the past few years is still being absorbed, with vacancy rising and rents weaker.
In July, the national multi-family vacancy rate rose to 7.1%, setting records in the monthly index of apartment lists dating back to 2017. The report says that while the market passes the peak of this latest construction boom, it is still overbuilding compared to demand.
Landlords are not as much stock as they were earlier this year, but it’s still like a tenant’s market. Over 600,000 new apartment complex units appeared on the market last year, representing a 65% increase compared to the newest supply in 2022 and one year since 1986.
According to the report, in July it took an average of 28 days after the list was listed. This is slightly longer than June, but down from the most recent 37-day high seen in January.
Compared to June, it was not changed nationwide in July. According to the apartment list, the median rent was $1,402. Rent peaked earlier this year, rent growth halted during peak travel seasons, where growth is usually fastest.
According to the report, rents this month fell 0.8% from the same month last year. They were approaching positive annual growth earlier this year, but now they have tested negative for the third consecutive month, according to apartment list data.
“All of our key indicators point to an ongoing slowdown in the multi-family market. Rent growth is slipping and vacancy rates are at the highest ever,” the report said. “While a return to a more demanding market situation should still be on the horizon, the outlook is complicated by the macroeconomic whiplash being driven by tariffs and pursuits by the Trump administration.
Regionally, rents have risen from June in July to 37 in 37 metropolitan areas with populations of over 1 million. However, less than half of these cities have a positive growth in rents compared to a year ago. According to the report, rent reductions are most common in the previously very hot South and Western Shan.
Austin, Texas, won a questionable award as the softest rental market in the country, with rents down 6.8% compared to last July. Denver and Phoenix weren’t too late.
Conversely, San Francisco is seeing its biggest profit, up 4.6% from last year. Other strong markets include Fresno, California and Chicago.
“The supply wave is backwards, but the number of units that hit the market in the first half of this year was still above the long-term average. Conditions are likely to change as we expect it to be even slower from the second half of this year until 2026,” according to the report.
