This Small Midwest Market Ranks Among National Rent Growth Winners

Located about 160 miles south of Canada along the border of North Dakota and Minnesota is one the best apartment rent growth markets in the U.S. Fargo’s 5.4% increase in effective asking rents during the year-ending February tied with Champaign-Urbana in the #8 spot nationally, according to data from RealPage Market Analytics. That rent increase was notably ahead of the Midwest norm (2.8%) and far better than the U.S. average (0.2%). Fargo has a population of around 259,000 and less than 38,000 existing apartment units. During the pandemic, Fargo didn’t experience the massive rent change swings that most other markets across the country witnessed. In fact, Fargo avoided year-over-year rent cuts and never ventured into double-digit annual rent growth. The market’s recent rent increase was well ahead of its pre-pandemic average of just 1.1% (2015-2019). Despite the recent rent increases, Fargo remains relatively affordable for renters. Effective asking rents in the market averaged $1,027 in February 2024, below the Midwest region average ($1,408) and well below the U.S. norm ($1,806). Helping drive rent growth in Fargo has been limited new supply. Over the past five years (2019-2023), Fargo received an average of roughly 400 units annually. With minimal new supply, occupancy in Fargo has remained tight, averaging 96% over the past five years and registering at 95.5% as of February 2024.