As the new year starts, here's a few quick predictions for the apartment market in 2025:
- 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 decade.
