**Yardi Matrix Reports Sluggish May Multifamily Metrics**
According to Yardi Matrix’s May 2025 National Multifamily Report, rent growth across the United States followed a “steady if unspectacular” trend, registering a 1% year-over-year increase. Occupancy fell to 94.4%, marking the lowest level in over a decade, a decline of 0.3%.
The report attributed this softening in occupancy to a continued influx of new apartment deliveries. “While there has been an influx of new apartment completions, particularly in 2024, the demand for rental housing is also rising,” said Doug Ressler, Manager of Business Intelligence at Yardi Matrix. “The increased demand is helping to stabilize and push rent growth back into positive territory.”
**Regional Performance Varies**
Geography continues to play a critical role in multifamily performance. The report highlighted that gateway and secondary metropolitan areas in the Northeast and Midwest experienced the strongest rent growth. These areas tend to have limited new development and sustained demand. Ressler added that oversupplied markets—such as many of those in the Sunbelt region—continue to register negative rent growth.
Ressler also emphasized the appeal of cities with more stable and diversified economies and generally more affordable living options. In addition, markets anchored by major research universities, particularly in biotech hubs, are facing what Ressler called “above-average downside risk.”
“Boston, San Francisco, Raleigh-Durham, Seattle, and San Diego are among the MSAs we will monitor closely over the next 12–18 months,” he said. The report noted that economic uncertainty is compounded by narrow cap rate spreads and a Treasury rate holding at approximately 4.5%.
**Looking Ahead**
Yardi Matrix’s outlook for the multifamily sector suggests modest growth in the near term. The firm forecasts national rent growth of 1.6% in 2025 and 1.2% in 2026, with a longer-term trend expected to stabilize between a 3% to 4% growth rate. Occupancy rates are projected to remain steady, with forecasts pegged at 94.6% in 2025, 94.7% in 2026, and 94.6% in 2027.
While the economic policy direction of the presidential administration may take time to manifest in measurable ways, the overall forecast carries a tone of cautious optimism. Ressler noted that the summer leasing season is unfolding amid mixed economic indicators. While payrolls, consumer spending, and household balance sheets appear stable, certain signals—such as consumer sentiment and ISM new orders—suggest a potential slowdown.
He acknowledged that localized economic disruptions, such as job losses or business closures, could dampen demand for rental housing and impact both rent levels and occupancy. “Overall, the balance of risk has modestly tilted toward slower growth,” Ressler said. “But a recession is not our base case.”
