Baby boomers who are retiring, selling their homes and moving to rental apartments are helping to stabilize occupancy and support rent growth in multifamily housing, according to a new national market outlook from Yardi Matrix.
The report, “Multifamily Votes for ‘More of the Same,’ ” also credits millennials, who are starting to be at the prime age for renting, for trends in the sector.
The report authors predict that multifamily rent growth will moderate this year after two years of increases that were above-trend, although that has not happened yet. “As of April, the average national rental rate rose to an all-time high of $1,194, as rents were up 2.6% year to date and 6.0% year over year,” they write.
The homeownership rate fell to 63.5% in the first quarter, down 0.2% year over year, according to the report. In April, the occupancy rate was 96% for luxury lifestyle units, defined as apartments for those who choose to rent even though they have funds that make homeownership possible. “Discretionary households, most typically a retired couple or single professional, have chosen the flexibility associated with renting over the obligations of ownership,” the report authors state.