Multifamily Rents Rise Modestly in July Amid Strong Demand

Multifamily rents edged up in July as demand stayed strong, though high supply continues to limit growth in key US markets.

August 8, 2025

Nina Dale

The average US advertised multifamily rent rose $2 in July to $1,754, up 0.7% year-over-year. Growth has stayed in the narrow 0.5–1.1% range for the past 20 months.
Absorption is strong, with more than 300,000 units absorbed through June. That pace would mark the highest annual total since 2021.
Midwest and Northeast metros lead annual rent growth, while several Sun Belt markets continue to see declines as supply peaks.

Key Takeaways

A Slow but Steady Climb

National multifamily rents rose modestly in July. The $2 increase kept year-over-year growth at 0.7%, according to Yardi Matrix. Demand is strong, with over 300,000 units absorbed so far in 2025. But new lease-up inventory is still holding back rent gains.

Regional Standouts

Chicago (+4.1% YoY), Columbus (+3.9%), and Detroit (+3.5%) led the nation. Coastal markets like New Jersey (+2.7%) and San Francisco (+2.6%) also posted solid gains. Sun Belt metros remain under pressure, with Austin (-4.6%), Denver (-3.9%), and Phoenix (-2.8%) among the weakest.

Occupancy Holds Firm

The national occupancy rate was 94.7% in June. That is unchanged for four straight months and down only 0.1% year-over-year. Strong absorption has kept occupancy stable despite 1M units under construction, about half still in pre-lease.

Why the Outlook Is Improving

Deliveries should slow in coming quarters as new starts decline. This will help ease supply pressure. Job growth is exceeding expectations, and tariff impacts on the economy appear less severe than feared earlier this year.

Challenges Remain

High interest rates are still holding back transactions. Multifamily sales reached $36.4B year-to-date, up just 1% from last year. Expenses are also high, but growth is slowing. Insurance costs are rising at the lowest pace since 2020 after years of steep increases.

What’s Next

If demand stays strong and completions slow, multifamily rents could see stronger growth by late 2025. Recovery in heavy-supply Sun Belt markets—like Austin, Nashville, and Charlotte—may take longer.