The national average multifamily rent rose $3 to $1,469 in July 2019, while year-over-year rent growth rose to 3.4%, up 10 basis points from June. According to the latest Yardi Matrix Multifamily National Report, this marks the 13th month in which rent has risen over 3% on a year-over-year basis.
Most of the nation’s major metros are showing strong rent growth, apart from Houston and Miami, which have maintained their lower rates. Las Vegas showed the strongest rent growth once again this month at 8% YOY, followed by Phoenix at 7.1%. While Yardi notes these fast-growing Southwest metros are no longer as inexpensive relative to the rest of the country as they once were, their rent increases remain robust on a month-to-month basis.
Many markets have displayed this growth in spite of headwinds. Nashville (4%) and Charlotte, N.C. (4.6%) are among the leaders for new completions as a percentage of stock over the last 12 months, and Boston, Portland, Ore., and Seattle—all high-cost tech hubs—have experienced strong rent growth on a trailing three-month (T-3) basis.
Washington, D.C.’s rent growth has risen to 3.7% year over year through July, following a pattern of increases below 1% through 2017 and 2018. Yardi owes this turnaround to a number of newly rehabilitated areas, such as The Wharf, and high average occupancy rates, despite rents above the national average and underperforming job growth.
Rents for luxury or Lifestyle properties rose by 3.1% at the national level, marking the segment’s strongest growth since September 2016. Rents for market-rate Renter by Necessity properties are still rising more quickly, but the gap between them has narrowed to 50 basis points, the smallest since May 2012.
On a T-3 basis, which compares results from the last three months with the previous three months, rents rose by 0.5% at the national level in July, down 20 basis points from June. Boston, Portland, and Seattle led this metric with 0.9% rent growth, along with growth of over 1% in the luxury Lifestyle segment. Overall, Lifestyle rents rose 0.5% on a T-3 basis, compared to Renter-by-Necessity rents, which rose 0.4%.