In the third quarter of 2023, the U.S. multifamily market saw strong demand from renters, although rent growth has slowed compared to previous highs. According to CBRE’s latest research, the multifamily vacancy rate increased by 10 basis points quarter-over-quarter to 5.1%, a slower rise than in Q1 and matching Q2’s increase.
During this time period, net absorption rose to 82,100 units and average monthly net effective rent growth reached 0.7%. These numbers indicate a return to more typical seasonal demand patterns after being disrupted by the pandemic.
CBRE leader of Multifamily Capital Markets Kelli Carhart stated that despite record new construction levels, renter demand remained healthy throughout Q3. Looking ahead into mid-2024 when investment activity is expected pick up due an end in Fed rate hikes and improved capital markets conditions as well as loan maturities creating transaction opportunities.
