July 23, 2020

Tucson Q2 Multifamily Market Report: Investment Activity Concentrated in Smaller Deals

Highlights:

The Tucson multifamily market has posted fairly steady performance through the first half of 2020. During the second quarter, vacancy inched higher, but the rate is still lower than one year ago. Rents leveled off in the second quarter after strong gains for the past few years.
Vacancy inched higher in the second quarter, ticking up 10 basis points to 5.3 percent. The rate has been on a steady improvement cycle in recent years, and the current figure is 60 basis points lower than one year ago.
Asking rents were flat from the first quarter to the second quarter, holding steady at $839 per month. Average rents are
up 4.4 percent during the year.
Investment activity strengthened in the first half of 2020, spiking by approximately 50 percent from the same time period in 2019. The median price in the first half of the year was $66,100 per unit, while cap rates averaged 5.7 percent.