Apartment rents drop in July as vacancies move to multi-year high

The massive surge of new apartment supply in the last few years is still being absorbed, and that has vacancies rising and rents weakening.

The national multifamily vacancy rate rose to 7.1% in July, setting a new record on Apartment List’s monthly index, which goes back to 2017. The report notes that while the market has passed the peak of this latest construction boom, it is still overbuilt relative to demand.

Landlords are not quite as overstocked as they were at the start of this year, but it is still more of a renter’s market. Last year more than 600,000 new multifamily units hit the market, representing a 65% increase compared to 2022 and the most new supply in a single year since 1986, Apartment List found.

For July, it took an average of 28 days to lease units after they were listed, according to the report, slightly longer than in June but down from the recent high of 37 days seen in January.

Rents nationally were unchanged in July compared with June; the median rent was $1,402, according to Apartment List. Rents peaked earlier this year, and rent growth has now stalled during the peak moving season when growth is usually fastest.