Revisiting Apartment Market Forecast Profiles from 2024

At the beginning of 2024, with new supply volumes increasing and job growth performing beyond expectations, our economists picked their favorite apartment markets to watch across the U.S. this year.

Six months into the year, let’s check in on how these markets are performing now.

Early Favorites to Lead

Many of the markets favored to lead in 2024 shared one common theme: limited supply pipelines. But it's more than limited supply that's kept many of these markets ahead of the pack in 2024 - it's also taken decently strong demand as well. As of June 2024, Cleveland (#3), Cincinnati (#4), Columbus (#9) and Chicago (#10) have seen rent growth trend well ahead of the national norm, according to data from RealPage Market Analytics.

Surprising Upside

Surprising upside implies there's some risk in picking a "dark horse" market so to speak. San Jose & Washington, DC have seen rent growth outpace national norms with Washington, DC ranking #2 in the country. San Jose may be on the cusp of resecuring some job growth due to AI-driven tech improvement after a challenging 2023. Washington, DC meanwhile has seen migration flowing back into the nation's capital which has helped support revenue growth.

Potential Demand Challenges

Markets with potential demand challenges yield mixed-results as of mid-year. Los Angeles and Portland both have struggled to maintain any traction in 2024 as it appears locally sluggish economic growth is holding the markets back. Portland's annual job loss (-0.8%) ranks second-worst among the nation 50 most populous metro areas. Los Angeles meanwhile has seen very modest growth (0.6%), though acute supply pressure in Downtown LA and Mid-Wilshire in particular has resulted in extremely elevated turnover. LA saw 52% turnover among leases expiring in June 2024, which was the fourth highest in the country.

Strong Demand, but Supply Caps Rent Growth

Austin and DFW rank in the nation's top 3 markets for absorption to start the 2024 calendar year, furthering this idea that demand has been excellent. But that has yet to translate to any rent growth due to generationally large supply volumes. Phoenix also ranks in the top 5 for absorption yet has seen persistent rent cuts. Nashville has - by most expectations - outperformed to some degree considering locally massive supply figures.

Wild Card Markets

These markets had a high range of outcomes heading into 2024. Atlanta and Tampa have seen performance significantly trail the national average. In Atlanta, weak rent collections and lots of supply have held the market's performance back. Tampa on the other hand is dealing with softness in local lease-up properties with more than a 50% drop in per property per month absorption in the first six months of 2024 (vs. 2023). Newark/Jersey City continues to impress as it appears new supply delivering along the waterfront is attracting some renters who work in Manhattan but are pulled in by the lower rents of Jersey City.