November 13, 2018

Phoenix Q3 Market Report: Apartment Rents Remain on an Upswing

Report highlights:

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Conditions in the Phoenix multifamily market strengthened during the third quarter. Vacancy tightened and rents spiked. The investment market responded to the favorable fundamentals with an uptick in sales activity.
Vacancy in Phoenix fell 10 basis points during the third quarter, reaching 5.7 percent. The rate is unchanged from one year ago and has remained in a tight range since 2016.
Rents continue to rise at a rapid rate. Asking rents rose 1.8 percent from the second quarter to the third quarter, reaching $1,056 per month. Asking rents have surged 8 percent during the past 12 months.
Apartment deliveries have been on the rise, with more than 2,500 units coming online in the third quarter. Completions have topped 6,300 units year to date.
Investment conditions were mixed during the third quarter, with activity picking up as the median price crept lower. Cap rates have remained very consistent throughout the year, averaging 5.3 percent.