Multifamily Rent Growth Forecast Gets an Update

Article originally posted on Globe St. on April 9, 2024

Strengthening job growth data from Q4 2023, shifts in GDP forecasts and retail sales, and the imminent action of the Federal Reserve has RealPage updating its effective rent growth forecasts for major markets, including 12% of the top 50 to rise by 3% or higher this year.

Most major markets are forecasted to experience growth between 2% and 2.9% and 38% of markets are predicted to see rent growth from 1% to 1.9%, its analyst Arben Skivjani writes.

Those forecast to grow by 3% or higher were Anaheim, Chicago, Columbus, Detroit, Indianapolis, and San Francisco.

Those expected to grow by between 2.9% and 2% were Baltimore, Boston, Cincinnati, Cleveland, Denver, Greensboro, Kansas City, Milwaukee, Minneapolis, New York, and Newark.

Rising by between 1.9% and 1% are Atlanta, Charlotte, Dallas, Fort Lauderdale, Fort Worth, Houston, Jacksonville, Las Vegas, Los Angeles, Memphis, and Miami.

Only 8% of markets are expected to grow by less than 1%, namely, Austin, Orlando, San Antonio, and Tampa.

Some 637,000 jobs were added in Q4 last year, led by Los Angeles, New York, and Houston. RealPage said Austin, Las Vegas, Houston, Orlando, and Phoenix were other strong job growth metros among the larger US markets.

RealPage said it expects the Federal Reserve might start reducing interest rates in the latter half of the year.

GDP growth in 2025 is expected to slow compared to late 2023 and consumer spending and retail sales should be key economic drivers.