How Durable Is Multifamily Demand?
Apartment demand rebounded in the third quarter in many metros, a good sign for the industry after a weak first half that was caused in large part by the fallout from COVID-19.
National Quarterly Net Absorption QoQ
Apartment demand rebounded in the third quarter in many metros, a good sign for the industry after a weak first half that was caused in large part by the fallout from COVID-19. The rebound helped to stabilize the multifamily market and prevented asking rents from declining as much as would have been expected considering the historic decline in economic performance in the second quarter.
Increased absorption in July and August was led by many secondary metros in the Southeast and West—including Dallas, Denver, Atlanta, Phoenix and Charlotte—resuming the strong demand that those markets experienced over the decade before the pandemic hit.
The recovery remains stalled, however, in high-priced gateway markets, which have had the largest population defections and may face the longest and most difficult recoveries. San Francisco, Chicago, Los Angeles and San Jose had steep drops in rent growth and absorption year-to-date through August, while New York rents have also declined sharply amid weak absorption.
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