The office and apartment sectors recorded rising vacancy rates in fourth quarter 2024, while industrial vacancy rates fell and retail vacancy rates held steady, according to Moody’s Q4 2024 Preliminary Trend Announcement.
The multifamily sector saw effective rent growth of 0.2 percent, and the market delivered a balanced performance in the second half of the year. With high amounts of inventory growth, the average vacancy rate increased by 10 basis points in the final two quarters of 2024, as it finished the year at 6.1 percent. The apartment vacancy rate is 40 basis points higher than it was at the beginning of the year, and is the highest it has been since 2011.
Rental demand for apartments was steady, due to population growth and recovery in immigration. In addition, U.S. GDP has been steadily increasing, and the 30-year fixed mortgage rate remains at around 7 percent. These factors encourage renters to stay in the rental market, which balances out the su
