Article originally posted on CoStar on Oct 1 2026

U.S. apartment rents recorded a modest decline in September, continuing the seasonal slowdown that typically emerges after the peak summer leasing season. Despite weaker monthly performance, annual rent growth continued to build nationally as markets benefited from favorable year-over-year comparisons and gradually improving apartment market conditions, according to Apartments.com’s latest report on multifamily rent trends.

One of the clearest signs of improving apartment fundamentals emerged across the Sun Belt and Mountain West, according to the report. The South posted its first positive annual rent growth reading in a year, while rent declines in the Mountain region were far smaller than earlier in the cycle, suggesting some of the nation’s most supply-heavy regions are gradually regaining footing.

According to the latest Apartments.com multifamily rent report, the average national apartment rent declined to $1,752 in September from August’s upwardly revised level of $1,753. While monthly rent growth remained negative, the September decline was considerably smaller than the rent pullbacks recorded during the same month in both 2024 and 2025. As a result, average annual rent growth accelerated to 1.5%, the highest reading in more than a year.

Though apartment construction activity has slowed across much of the country, a substantial inventory overhang remains in many markets. Available supply continues to temper national pricing power, but a gradual decline in new apartment completions and continued demand growth have contributed to steadily improving annual rent performance in recent months.

Regional performance was generally weaker in September, with all five major regions recording declines in monthly rent. The Mountain region experienced the largest decrease, while smaller declines were recorded elsewhere across the country. Annual performance, however, continued to reflect the gradual easing of apartment supply pressures. The Pacific region led the nation with annual rent growth of 2.4%, followed by the Midwest at 2.3% and the Northeast at 2.2%. The South returned to positive annual rent growth for the first time since September 2025, posting a modest 0.2% increase. Meanwhile, the Mountain region remained slightly negative at -0.1%, though rent conditions have improved substantially from earlier in the year as markets continue to work through the effects of elevated apartment supply.

Among major metropolitan areas, apartment rent growth became even less widespread in September. Only eight of the nation’s 50 largest apartment markets recorded monthly rent increases, compared with 12 in August. Indianapolis led the nation in monthly rent growth, followed by Louisville, Kentucky, and Orange County, California, while Salt Lake City posted the largest monthly decline.

On an annual basis, Northern California markets continued to dominate the rankings. San Francisco led all major apartment markets with annual rent growth of 12.8%, followed by neighboring San Jose at 8.2%. Norfolk, Virginia, and the Oakland/East Bay area in California also remained among the nation’s top performers. In contrast, several Sun Belt and Mountain markets continued to face pressure from elevated levels of recent construction activity.

Markets with some of the nation’s largest supply-and-demand imbalances remained under pressure. San Antonio recorded the largest annual rent decline at 1.8%, followed by Las Vegas at 1.3%. Denver and Houston each posted annual declines of 1.0%, reflecting markets where new apartment supply continues to outpace demand growth.

September’s results point to a market that remains heavily influenced by local supply conditions. Monthly rent growth weakened further as the fall leasing season progressed, but steadily improving annual performance, including the South’s return to positive growth and the Mountain region’s gradual recovery from earlier supply-driven declines, provides additional evidence that pricing conditions are stabilizing as the U.S. apartment sector moves beyond peak construction activity.