Tucson Q2 Multifamily Market Report: Low Vacancy, Elevated Absorption Fuel Rising Rents

Highlights:

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• The Tucson multifamily market recorded healthy performance during the second quarter with a rapid pace of absorption putting
  significant upward pressure on rents. Demand is forecast to remain elevated in the coming quarters, while new units will be
  delivered to boost the inventory of available units.
• Vacancy inched up 10 basis points during the second quarter, but at 4.4 percent, the rate is only slightly higher than the market’s all-time low. Year over year, area vacancy has declined 90 basis points.
• Rent growth spiked during the second quarter, as owners responded to tight conditions and a surge in renter demand to implement healthy rent gains. Average rents ended the second quarter at $992 per month, up more than $100 per month since the end of last year.
• The number of property sales slowed during the second quarter, following more than a year of steady activity. Despite the recent dip in transactions, prices are on the rise, and cap rates have compressed to just 5.1 percent.

Read the report