Apartments.com Releases October 2022 Rent Growth Report

Today, Apartments.com – a CoStar Group company – published an in-depth report of multifamily rent growth trends for October 2022 backed by analyst observations. Month over month rent decline hit a three-month streak with October’s numbers in the books, alongside continued evidence the once fastest growing markets have lost momentum and new markets are coming into play.

This press release features multimedia. View the full release here: https://www.businesswire.com/news/home/20221104005449/en/

Year Over Year Rent Growth, by Market (Graphic: Business Wire)

“Since August, sequential monthly rent growth has started tracking downward, but we’re witnessing that decline accelerate – rents decreased by $9 or 0.6% in October compared to just 0.3% 30 days prior,” said Jay Lybik, National Director of Multifamily Analytics at CoStar Group. “These rent conditions reflect a rough start to the already typically slow fourth quarter as new deliveries continue to drastically outpace demand.”

YEAR OVER YEAR REMAINS POSITIVE, DECELERATION PICKS UP SPEED

While sequential monthly rents decreased, year over year rents remained in the green. However, the pace of deceleration continues to pick up momentum as October asking rents fell to 4.8% from 5.7% at the end of September. Additionally, none of the top 40 largest markets saw their year over year asking rent expand in the month of October, which further illustrates the overall disappointment in market conditions.

MIDWEST MARKETS SURGE AHEAD, PALM BEACH AND LAS VEGAS AMONG SUNBELT PULLBACKS

Throughout 2021 and most of this year, the fastest growing markets dotted the Sunbelt. Now, only two markets in that region hold the top rent growth spots and five out of ten markets sit squarely in the Midwest and Gateway locations. Markets with the fastest growing rents are now witnessing the quickest drawback.

Palm Beach, in particular, has seen a dramatic slowing of growth with year over year asking rents decreasing from 30.6% in Q4 2021 to 3.8% at the end of October. Las Vegas isn’t far behind with year over year asking rents down to 1.5% in October compared to 22.0% at the beginning of 2022. Tampa and Phoenix are also among the markets that witnessed rents retreating by over double digits so far this year.

MONTH OVER MONTH PAINTS STARK PICTURE, FORMER HIGH FLYING SUNBELT MARKETS OCCUPY BOTTOM TEN

The true nature of the deteriorating rent situation can be understood when looking at sequential rents month over month. Only three out of the 40 largest markets saw month over month rents holding positive or at zero. In absolute terms, San Jose rents declined the most in the last 30 days, down 1.3% or $45.