Tucson 2Q23 Multifamily Market Insights Report: Vacancy elevated, but rents still push higher

Highlights:

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• The Tucson multifamily market posted a mixed performance during the second quarter, as rents advanced while the vacancy rate pushed to a new high. Development activity remains strong as projects totaling 584 units have been delivered to this point in 2023.
• The local vacancy rate rose 60 basis points during the second quarter, reaching 8.1%. Year over year, vacancy increased by 230 basis points.
• Rent growth accelerated in recent months after holding fairly steady in the previous three quarters. Rents rose 1.6% during the second quarter to $1,182 per month. Local rents increased 2% during the past 12 months.
• Multifamily sales activity has been light to this point in the year, as only a few transactions closed during the past six months. Most properties are selling with cap rates between 5.75% and 6.25%.

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