2024 Rent Prices Face a HUGE Challenge (1M Multifamily Units Coming)

Episode #195

Rent prices peaked in 2022 after a double-digit percentage run-up. Due to more household formation, disposable income, and remote work availability, Americans were doing whatever they could to upgrade their housing to bigger, better, and often more expensive options. But, after interest rates shot up, the economy began to cool, and work-from-home became a not-so-sure thing, Americans became more budget-conscious. As a result, vacancies rose, and rent prices began to fall. So, how close are we to seeing rent growth return?

Apartment List’s senior housing economist, Chris Salviati, joins us to share what his team has seen in the nationwide rent data. Chris looks mostly at large apartment data—the sector that’s been hit the hardest in recent years. With multifamily properties struggling to find renters and lowering their asking prices to prompt demand, you’d think the market had found a bottom—but this isn’t the case.

A tidal wave of multifamily inventory is about to come online, and when it does, multifamily investors will be forced to compete with the newest and most luxurious options on the market. Will this oversupply trickle down to single-family rentals, or will renters turn away from the A-class buildings in search of more affordable options? Chris gives us his thoughts, plus future rent growth predictions, in this episode!

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Multifamily Is at High Risk of Continuing Its Historic Crash in 2024—Here’s Why:
https://www.biggerpockets.com/blog/multifamily-crash-to-continue-through-2024?utm_source=youtube&utm_medium=description&utm_campaign=none
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Rents Show Biggest Decline in 3 Years—Should Landlords Panic?
https://www.biggerpockets.com/blog/rents-show-biggest-decline-in-three-years?utm_source=youtube&utm_medium=description&utm_campaign=none
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2024 Rental Market Outlook: Is a Shift Coming?
https://www.biggerpockets.com/blog/2024-rental-market-forecast?utm_source=youtube&utm_medium=description&utm_campaign=none
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Connect with Chris:
Articles and Reports: https://www.apartmentlist.com/blog/author/salviati
LinkedIn: https://www.linkedin.com/in/crsalviati/
X/Twitter: @chris_salviati or https://twitter.com/chris_salviati
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Show notes at: https://link.chtbl.com/OTM

00:00 Intro

02:18 Post-Pandemic Rents Up 18%

06:15 Households Form, Rents Rise

10:41 Renters Are Cautious to Spend

15:11 1M More Apartments!?

21:56 Effects On Single-Family Rentals

29:26 Rent Inflation "Cools Off"

33:08 2024 Rent Predictions

36:48 Should Landlords Be Worried?