Cities Experiencing the Highest Multifamily Rent Increases as of Q3 2022
Specializes in providing actionable insights into the commercial real estate space for investors, brokers, lessors, and lessees. He covers quarterly market data reports, investment strategies, how-to guides, and top-down perspectives on market movements.
The United States housing market is still recovering from the pandemic, and it’s taking some time for things to get back on track. However, rising demand for multifamily housing in select cities across the nation is propping up multifamily portfolios.
This increase in demand is, in turn, increasing multifamily rents and the cost of living in these locations. That said, rising interest rates and slowing capital markets are expected to cool this activity as we go into 2023.
But until then, here are some cities experiencing the highest multifamily rent increases as of Q3 2022.
#10 – San Jose, California
As rents continue to rise in major US cities, multifamily real estate proves to be a profitable investment for commercial real estate investors. Despite residents moving out of this city to other states with fewer COVID restrictions, San Jose, California’s year-over-year rent growth was 7.7% in Q3 2022.
#9 – Dallas-Fort Worth, Texas
One of the most obvious factors driving multifamily rent growth in Dallas-Fort Worth is population growth. As more people move to the area, there’s a corresponding increase in demand for apartments and other rental properties.
Year-over-year rent growth in Dallas-Fort Worth, Texas was 7.8% in Q3 2022.
The strong rental demand in Dallas-Fort Worth has led to a tight rental market and a limited supply of available homes for sale. This shortage of available homes is driving up rents across the metro area.
#8 – San Diego, California
Year-over-year rent growth in San Diego, California was 8.1% in Q3 2022. The strong demand for housing in San Diego, coupled with the strong demand for multifamily properties, has led to an increase in both rent and sales prices across all price ranges.
#7 – Cincinnati, Ohio
In the Cincinnati, Ohio area, rent growth is outpacing many other parts of the country. Year-over-year rent growth was 8.6% in Q3 2022. As more people move to the city, there is also an increased demand for apartments that are available for rent. To meet this growing demand, developers are building more multifamily buildings in Cincinnati.
#6 – Charlotte, North Carolina
The Charlotte, North Carolina metro area is one of the fastest growing in the country. It’s also seeing some of the strongest rent growth of all major markets. As a result, the year-over-year rent growth in Charlotte was 8.8% in Q3 2022. New jobs are being created in Charlotte and more people are moving to the area. Both of these factors have put upward pressure on rental prices.
#5 – Salt Lake City, Utah
As the value of most homes in Salt Lake City, Utah continues to rise, so too do the prices of rental properties in the area. This rise in housing costs has led to an increase in demand for rental units across the city, and as a result, rental prices are on the rise: Year-over-year rent growth in Salt Lake City, Utah was 8.9% in Q3 2022.
#4 – Fort Lauderdale, Florida
Multifamily rents in most of Florida’s primary markets have experienced steady growth over the past few years. This year, year-over-year rent growth in Fort Lauderdale, Florida was 9% in Q3 2022.
There’s also a wide range of available properties in Fort Lauderdale, from affordable studios to luxury high-rises. There are many factors contributing to this growth, including an increase in demand for rentals and higher interest rates on mortgage loans.
#3 – Indianapolis, Indiana
Rental growth has been strong in many U.S. cities, but Indianapolis has been one of the biggest beneficiaries so far this year. The city’s multifamily apartment market is booming as more residents choose to live in apartments. Rents are rising across the board, with year-over-year rent growth in the city at 9.1% in Q3 2022.
A growing population and increasing demand for rental properties are two key factors driving multifamily rent growth in Indianapolis this year.
#2 – Orlando, Florida
It’s no surprise that multifamily rents in Orlando, Florida are rising rapidly this year. The city has seen a surge in the number of people moving to the area, particularly people moving from out of state. Because of the influx of newcomers and growing demand among residents, there are plenty of new tenants looking for apartments each month.
Year-over-year rent growth in Orlando, Florida was 9.4% in Q3 2022. The area’s economy has been relatively healthy and unemployment is low. These factors have led to an influx of new residents looking for places to live and jobs to fill.
#1 – Miami, Florida
Surprise: Miami is back on another list of most expensive places to lease. Miami is one of the most popular cities in the country with a thriving multifamily market: Year-over-year rent growth in Miami, Florida was 10.6% in Q3 2022.
Miami is a popular vacation destination, and because of that, it has a large amount of luxury apartment units and condominiums for rent, therefore creating high demand for rental property in Miami.
Continued Long-Term Rent Growth Since 2015
The multifamily industry in most of the county mirrors the overall economy, which has seen modest rent growth since 2015. Occupancy rates declined slightly during the third quarter, increasing in only nine of the nation’s top 35 metro markets.
Higher mortgage interest rates and fewer new homes sold are likely to support demand for single-family rentals. If people cannot afford houses, they still need to live somewhere. This presents a great opportunity for multifamily investors.
While there are many lucrative opportunities in the multifamily market, you have to know where to look. Do your research, stay diligent, and happy investing.
List & Browse Commercial Real Estate for Free on MyEListing.com!
You can list and browse commercial real estate for free right here on MyEListing.com.
Simply sign up for a free account and get unlimited access to accurate local market intelligence, customized property type alerts, comp software, and more.
Other recent articles
Article Search
Share
All Article Categories
