Tucson Q4 Multifamily Market Report: Low Vacancy Sparks Rapid Rent Growth
Highlights:
- The Tucson multifamily market closed 2020 on an upswing, sustaining the momentum that was achieved during the third quarter. The local vacancy rate dipped to its lowest level in more than two decades, and rents continued to post healthy gains.
- Vacancy fell 120 basis points in 2020, the eighth consecutive year where the rate trended lower. The local vacancy rate dipped 20 basis points during the fourth quarter, falling to 4.3 percent.
- Local asking rents advanced 2.5 percent in the fourth quarter, ending the year at $889 per month. Multifamily rents in Tucson spiked 7 percent in 2020, one of the country’s most significant increases.
- Sales of apartment properties surged during the fourth quarter, capping off a strong year of investment activity. Sales velocity rose approximately 35 percent from 2019 to 2020, with the fourth quarter representing the period of the most transactions. For the full year, prices and cap rates closely tracked levels from 2019.
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