The 2025 Multifamily Outlook from Yardi Matrix predicts a moderate increase in apartment rent growth following the steady performance of the U.S. market in 2024. The report anticipates a national rise of 1.5% in advertised rents, with metro areas in the Northeast and Midwest leading the way.
According to Yardi Matrix, “the multifamily market is entering 2025 on solid ground after experiencing strong demand for several years and with expectations that interest rates will decrease.” However, they caution that changes may occur under the new administration which could have both positive and negative effects on apartment demand.
In terms of stock expansion, there were approximately 550,000 units added to inventory in 2024 but this number is expected to decline to around 508,000 units by next year. Meanwhile, absorption totaled at about3700 ,000 units through November. New construction also decreased significantly from its peak level of708 ,000 rental units started construction backin2012 . This drop will lead to fewer deliveries startingin2016 , resultingin an increase ingrowthrents accordingtoYardiMatrix .
One major metro area expectedto see above-averageapartmentrentgrowthis Philadelphia (pictured), alongwith11 othermajorcitiesacross thenation . Overall,the forecastforapartmentrentgrowthisin line withmodestbutsteadyperformance seeninthemarketduringthepreviousyearandshowspositiveprogresstowardsgreatergainsinthefuture.
