The U.S. housing market continues to face challenges in 2025, as rents increase and interest rates stay elevated, according to The Joint Center for Housing Studies of Harvard University’s 2025 The State of the Nation’s Housing. Federal housing support is decreasing, threatening crucial assistance programs for those in need. In addition, the possibility of an economic downturn undermines the already critical housing market challenges.
With fewer households able to become homeowners, rental demand has grown and so has multifamily rental unit supply. The growth in rental demand drove down multifamily vacancies and pushed the occupancy rate to 89 percent. As vacancies declined, rent grew by 0.8 percent annually in first quarter 2025. While many markets saw rent increases, one-third of markets, specifically those with the most new construction, saw declines in rental rates.
While new construction has expanded the rental supply, it has not helped the supply of l
