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Special Report

Multifamily National Report

3Q 2023

Gateway Markets Demonstrate Resilience, but
Rising Operating Expenses a Broad-Based Concern

Return of seasonal demand helped stabilize sector. The spring months of 2023 were once again a strong period for apartment demand, after the pandemic had disrupted normal seasonal patterns. From April through June, about 80,000 units were absorbed on net, the largest quarterly total since the opening three months of 2022. At the same time, net absorption fell short of the 107,400 rentals finalized during that span, keeping vacancy on the ascent. These dynamics foreshadow the remainder of 2023. Household creation is gradually improving, yet continues to be hamstrung by economic uncertainty and inflation. As a result, net absorption will remain in positive territory through year-end, but will trail record construction.
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