Richmond 2Q23 Multifamily Market Insights Report: Developers trying to keep pace with renter demand

Highlights:

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• Renter demand in Richmond has remained strong, supporting additional rent gains even as supply-side pressures have pushed vacancy rates higher. Projects totaling more than 2,700 units have been delivered thus far in 2023, with new developments leasing up at a healthy pace.
• Area vacancy showed signs of stabilizing in recent months after recording increases in recent periods. The vacancy rate ticked higher by 10 basis points during the second quarter to 6.1%. Year over year, local vacancy is up 120 basis points.
• Apartment rents in Richmond have been on an upward trajectory for the past four years, and gains continued to be recorded during the first half of 2023. Year over year, asking rents have risen 2.6% to $1,514 per month.
• Sales activity in the second quarter closely tracked volume from the start of the year. In the transactions that have occurred to this point in 2023, the median sales price is $175,000 per unit — while cap rates are between 5.25% and 5.5%.

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