San Jose Multifamily Market Report

Vacancy realigns with the historical average. Announcements of layoffs and hiring freezes by major tech companies have been making headlines as of late; however, the recent news has not been indicative of San Jose’s overall labor market. The metro has posted job gains in each month since February 2021, while recording an unemployment rate more than 250 basis points below its long-term average entering April of this year. Although net apartment absorption has slowed nationally due to a flattening economy, the stability of Silicon Valley’s labor market helped sustain demand and moderated upward pressure on availability. In fact, at 4.4 percent, vacancy in the South Bay was the lowest among Bay Area metros and only 40 basis points above the market’s 2019 level. The rate should remain relatively steady throughout 2023 as completions fall to a four-year low, limiting competition from new supply.