Kansas City Q2 Multifamily Market Insights: After Holding Steady for Several Quarters, Vacancy Begins to Tighten

Highlights:

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• Multifamily property fundamentals improved in Kansas City during the second quarter, as vacancy dropped and asking rents rose at a modest pace. Additionally, apartment development activity gained momentum.
• Local vacancy tightened in recent months, falling 40 basis points in the second quarter to 5.2 percent. Year over year, the rate declined by 50 basis points.
• Asking rents continue to push higher, although the pace of rent growth slowed in the second quarter. Local apartment rents rose 1.3 percent during the last three months to $1,113 per month. Year over year, average rents are up 10.2 percent.
• Sales activity slowed modestly in the second quarter. Year to date, the median sales price is $202,600 per unit. Cap rates remain low, averaging 3.8 percent in the last three months, but will likely rise in the second half of the year in response to higher borrowing costs.

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