Phoenix Multifamily Deliveries Picking Up, Likely to Accelerate in 2024

Highlights: 

• An active pace of new apartment construction dragged on property performance in 2023, despite healthy renter demand for units. With the development pipeline totaling more than 42,700 units under construction, supply-side pressures will persist through 2024.
• Vacancy pushed higher throughout much of 2023; during the fourth quarter, the rate rose 40 basis points to 7.4%. For the full year, vacancy rose 100 basis points.
• After mostly holding steady in the first half, rents retreated in the final six months of 2023. Rents ended the year at $1,575 per month, down 2.5% from one year earlier.
• The investment market picked up slightly during the fourth quarter, but transaction volumes were down 68% from 2022 to 2023. Prices ticked lower to $270,300 per unit, while cap rates averaged 5.25%.

Read the report, or engage with our Phoenix office to learn more.