2025 Multifamily Market Outlook: Key Trends and Top Metros
Multifamily Demand Is Supported By Broader Housing Trends
- High homeownership costs and elevated mortgage rates are steering more housing demand toward apartments
- Lease renewal rates are strengthening, supported by the affordability gap between renting and owning and home
- While concessions are rising, steady job growth will continue to bolster apartment absorption
Construction Pipeline Slows, Easing Oversupply Concerns
- Multifamily completions are forecast to decline to 410,000 units in 2025, a significant decline from 2024
- Rising costs for construction labor and materials are limiting the ability for new development projects to get off the ground
- Slowing construction amid solid demand will allow the national vacancy rate to fall to 5.1% in 2025
Top Multifamily Markets Offer Significant Growth Potential
- Miami ranks first (#1) on the 2025 Multifamily Investment Forecast, upheld by strong demographic drivers, above-average rent growth and a declining vacancy rate
- Dallas-Fort Worth places second (#2), with robust job growth and a thinning pipeline positioning the market for future gains
- Orlando comes in at third (#3), with nation-leading rent growth projected for 2025
*Forecast
Sources: Marcus & Millichap Research Services, RealPage, Inc.
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