The Top 10 Markets Driving Rent Growth
Despite a tough climate for multifamily, these 10 markets are leading the nation with the largest year-over-year increases in asking rent.
Even as rent growth decelerates, some key multifamily markets have managed to post gains above the national average of 1.2 percent. Here are the top 10 winners for year-over-year rent growth, based on Q2 data from CoStar.
Home to seven of the top 10 markets, the Midwest continues to dominate, joined by a few Northeast markets.
1. Cincinnati, OH
With 4.3 percent year-over-year rent growth, the Midwestern market of Cincinnati is leading the nation. Compared to an oversaturated national market, a relatively low supply in Ohio’s largest metropolitan area has contributed to a healthy balance of supply and demand.
2. Northern New Jersey, NJ
With its vacancy stabilized, the North Jersey market has established itself as the top market for rent growth in the Northeast region. Behind only Cincinnati, this market has seen rent growth slightly above 3.9 percent.
3. Norfolk, VA
Norfolk has seen its asking rent grow by almost 3.9 percent year over year. Q2 is the second consecutive quarter this year that this Virginia market has made the top 10 for rent growth, thanks to its relatively low levels of new construction and the stable demand from its naval base.
4. Columbus, OH
The capital city of Ohio, Columbus and its surrounding area have enjoyed over 3.8 percent rent growth in Q2. One of three Ohio markets to make the top 10, Columbus has maintained its status within the top 10 since late 2022.
5. Indianapolis, IN
Another Midwest star, the Indianapolis market has remained a rent growth leader for over a year. At 3.8 percent in Q2, this Indiana market has outpaced national rent growth averages. The twin factors of affordability and limited development have helped Indianapolis secure its position in the No. 5 slot.
6. Chicago, IL
The largest metropolitan area in the Midwest, Chicagoland has maintained above-average rent growth for the last year, showing 3.5 percent growth as of Q2. This stable market has seen only modest development, which has kept pace with demand, holding vacancy rates low.
7. Boston, MA
Boosted by low supply and high absorption, this Northeast market has seen relatively high rent growth, showing year-over-year rent growth of 3.5 percent in Q2. Thanks to these favorable conditions, the Boston market has stayed in the top 10 markets for rent growth for two consecutive quarters.
8. Kansas City, MO
In 2023, the Kansas City market has been outpacing the rent growth it saw during and before the pandemic. With a 3.5 percent year-over-year increase in Q2, this Midwestern market has been consistently in the top 10 for rent growth in 2023.
9. St. Louis, MO
Missouri’s largest metropolitan area has seen year-over-year rent growth of 3.4 percent, maintaining its rank in the top 10 markets for rent growth this year.
10. Cleveland, OH
Representing Ohio’s position as a new rent growth leader, Cleveland joins Cincinnati and Columbus in the top 10. Asking rent in this Midwestern market has grown 3.1 percent year over year since Q2 of 2022.