Continuing its strong march through the end of the cycle, research shows that the multifamily market had a good summer.
A new report from Yardi reveals that the average rent quietly reached an all-time high of $1,409 in July. After a $3 increase in June have risen 3% year-to-date and are up 2.8% year-over-year.
Yardi’s report chalks the peak up to strong economic growth in Q2 and healthy demand.
"One could say the market is experiencing typical summer growth, a good sign considering the length of the cycle, which has some worried that the party might be nearing its end," the report said.
"Economic conditions remain favorable for the multifamily industry, especially in secondary markets that are leading the nation in employment growth."
The YoY rent growth leaders remained mostly the same from June to July. Orlando, Las Vegas, California’s Inland Empire and Phoenix and Sacramento which replace Tampa in the fifth spot.
On the investment front, multifamily scored highest of all commercial asset classes in terms of its projected ability to maintain its performance in the near-term on Moody’s Red-Yellow-Green report.
“The multifamily sector remained the highest scoring sector in the first three months of this year, with its score unchanged at Green 83 [a great score]," Moody's Analyst Paul Cognetti said in a statement. "Construction, as a percentage of inventory, and forecast demand both slightly increased in the first quarter, as did the year-over-year vacancy rate, which improved in 25 markets, deteriorated in 39, and was unchanged in two."