CBRE: Multifamily Rent Grows Slightly

(Image courtesy of CBRE; Breakout image courtesy of Lisa Anna/

CBRE, Dallas, found multifamily fundamentals are beginning to stabilize, per first-quarter data.

Year-over-year rent growth was essentially the same as Q4 2023’s at 0.4%. CBRE predicts it will continue to remain fairly flat for the time being, before increasing in the second half of the year.

Average monthly rent stood at $2,163.

The vacancy rate increased by 10 basis points quarter-over-quarter to 5.5%–CBRE anticipates it will continue to increase through the middle of the year.

Vacancy rates in many markets are higher than long-term averages due to high numbers of construction completions recently.

There were 73,700 units completed in the first quarter, increasing the rolling four-quarter total to a record 429,500 units. However, fewer construction starts in recent quarters mean we likely won’t see such numbers in the next few years.

Net absorption was 52,200, the third-highest first quarter in the past 20 years and 47% above the pre-pandemic first-quarter average.

“Absorption has remained surprisingly resilient despite the record deliveries over the last few quarters,” said Kelli Carhart, leader of Multifamily Capital Markets for CBRE. “Investors continue to display a strong conviction toward multifamily. We expect multifamily capital allocation and deployment to increase as the year progresses.”

Annual net absorption was 301,700, 15% above the pre-pandemic average and significantly above last year.

But, in the quarter, multifamily investment volume fell by 28% to $19.8 billion, the lowest since the second quarter of 2020. Rolling four-quarter investment volume was down 50% to $111.7 billion, and the lowest four-quarter total since 2014.