Rent and Operating Trends – Week of March 26th 2023

Key Takeaways – Data as of 03/26/2023

Traffic and Leases:

• Traffic growth accelerated rapidly in sunbelt markets last week, led by San Antonio. Average traffic jumped by nearly a full tour per property in the central Texas market as demand remains elevated in the Lone Star state. Austin, Houston and Dallas also ranked in the top 10 for weekly traffic gains last week.
• Leasing activity also posted a strong week as only 3 markets tracked by Radix Research registered declining new leases.
• Chicago once again led the nation in new lease growth, and now ranks second in overall new leases signed per week. The average property is signing an average of 3.4 new leases per property per week.

Occupancy and ATR:

• Occupancy nationwide was unchanged last week, holding firm at 94.29%.
• At the metro level, occupancy was mixed, with Miami occupancy rising 10 basis points last week alone. Denver, Baltimore, and Phoenix also performed well as their occupancies rebound.
• All markets tracked by Radix Research have seen occupancy drop on a year-over-year basis, however Gateway markets and older markets in the northeast and Midwest have outperformed compared to their sunbelt peers. Chicago, San Jose, Baltimore, New York and San Francisco have the smallest drops in occupancy nationwide. In fact, only one sunbelt market, San Antonio, cracks the top 10 for best occupancy performance on a year-over-year basis. The outperformance of larger northern cities is likely due to the relative lack of new supply in these markets. Most new supply is concentrated across the sunbelt.

Net Effective Rent:

• Same-store net effective rent increased 10 basis points nationwide last week and 2.2% on an annual basis.
• Tampa led all markets with 50 basis points of rent growth last week alone, followed by Boston and Chicago.
• Year-over-year, Charleston leads all markets with nearly 8.5% net effective rent growth.