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**Multifamily Rent Growth Slows, Outlook Remains Tepid Through Year-End**
Multifamily rents remained largely stagnant in August, impacted by seasonal trends and growing uncertainty surrounding the financial health of consumers, according to Yardi Matrix. The average advertised rent across the U.S. dipped by just $1 to $1,755, as year-over-year growth slowed further by 10 basis points, settling at 0.7%.
“Rent growth is expected to remain lackluster through year-end,” stated the Yardi Matrix National Multifamily Report. The report highlights that momentum continues to wane across most metropolitan areas, with only a limited number of markets seeing year-over-year rent growth above 3%. This moderation in rent increases is largely attributed to elevated levels of supply rather than a drop in demand. High volumes of new deliveries have led to a competitive leasing environment, despite continued record absorption rates.
However, the report notes that supply-side pressures may be starting to ease. Most markets are believed to be past their peak in new supply, and construction starts have dropped sharply, influenced by rising construction costs and tighter financing conditions.
While demand remained strong through mid-year, there is growing concern among operators that it may soften in the coming months. Rising living costs and a weakening job market are tightening consumer budgets, posing additional challenges to rent growth as the year progresses.
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