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Market Report

Philadelphia Multifamily Market Report

3Q 2022

Supply Additions to Accelerate as Renter Demand
Approaches Pre-Pandemic Level

Center City retains renter appeal as signs of office return emerge. Though many of Philadelphia's office workers have yet to be called back to offices in the urban core as of August, a myriad urban amenities underscore this district's appeal, prompting a 350-basis-point decline in availability over the trailing year ended in June. Vacancy in the CBD entered July at 4.4 percent, 40 basis points below the pre-pandemic level. Headwinds that could potentially place upward, near-term pressure on availability should be mitigated as major employers implement hybrid schedules, enticing renters back to the core for shorter commutes. Additionally, homebuyers from costlier nearby markets are taking advantage of Philadelphia's lower relative home values, increasing the cost of housing here and exacerbating the affordability gap between rentals and single-family dwellings.
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