Chief Economist provides year-end analysis indicating stable footing and predicts what we can expect in the industry ahead RICHARDSON, Texas–(BUSINESS WIRE)–RealPage®, a leading global provider of AI-enabled software platforms to the real estate industry, announced today its 2024 year-end review of the multifamily housing market and key indicators to watch in 2025. Overall, the multifamily sector stabilized in 2024 with apartment demand matching a 50-year supply peak. In 2025, supply will remain a key factor to watch with the expected delivery of approximately 500,000 new apartment units. 2024 Industry Takeaways
Robust U.S. apartment supply — more than any year since 1974 — has matched the strongest renter demand in three decades besides 2021. The national occupancy rate held slightly below a “historically normal” level, averaging around 94.3%. Resident retention surged with lease renewals reaching a rarely seen 55%, while U.S. annual rent growth remained flat overall (less than 1%). Elevated apartment development saw 60% more units under construction than the 2010s-decade norm, but the pipeline began to slow with the fewest number of starts since early 2013.
2025 Industry Predictions
Supply is the key theme for 2025. Initially, abundant supply is expected to lessen through the year as economic headwinds challenge developers. Easing supply will likely give way to an environment where housing shortages challenge some metro areas beyond 2025. Renters in high-supply markets will see concessions as supply remains a heavy force on the market. As a result, retention will be a priority for operators looking to mitigate rising turnover and marketing costs. Demand will continue to catch up with the wave of new supply delivery throughout the Sun Belt, where rental rate growth is likely to be modest. Meanwhile, based on supply-demand factors, rents in lower-supply metro areas are expected to grow at a pace similar to the 2010s decad…