Fourth quarter net absorption totaled 55,600 units for multifamily properties in the United States, far better than expected given normally weak leasing in fourth quarters and during recessions, according to CBRE. The overall vacancy rate rose only 10 basis points (bps) to 4.5 percent in fourth quarter and was up by 50 bps year-over-year.
A high level of new deliveries far outpaced demand in the fourth quarter. Average rent declined 1.6 percent in the quarter to $1,666 per month. Year-over-year, average rent dropped 4.2 percent.
Certain multifamily segments performed better than average in fourth quarter, including suburban submarkets, smaller markets, the Midwest, Mountain West and Southeast regions and class B and C assets.
Overall, multifamily fundamentals should stabilize by second quarter 2021. Steady market recovery is expected through the second half of 2021.
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