Multifamily vacancy and rent growth projections have been revised in a new forecast from Apartments.com and CoStar.
The national multifamily vacancy is estimated to increase to 8.8% by the end of this year before easing to 8.4% at the end of 2027.
For landlords and operators, CoStar’s overall tone is “cautiously improving but still soft.” Rent growth has turned slightly positive again nationally, but they continue warning that excess inventory is restraining pricing power.
The market is still over-supplied in many Sun Belt markets due to high construction levels, combined with a softening job market, continues to put upward pressure on vacancy rates, which are experiencing a substantial, though easing, inventory overhang.
The apartment rent growth is now expected to increase from 0.2% in the first quarter of 2026 to 0.5% in the second quarter, an upward revision of 10 basis points from the previous forecast. The projected metric for the fourth quarter, however, was lowered slightly from +0.6% to +0.5%.
“The near-term rent growth outlook was maintained after modest first-quarter rent trends fell in line with expectations,” said Grant Montgomery, national director of multifamily analytics at CoStar Group.
“However, projections for the second half 2026 were lowered due to softer employment assumptions and the sizeable backlog of excess inventory accumulated across the last two years, which must be absorbed before market conditions can meaningfully tighten.”
“The balance of risks remains tilted to the downside,” said Montgomery. “A near-term energy price spike has eroded consumer spending power, and economists have downgraded employment growth expectations due to significant changes in U.S. tariff policy, slower labor force growth, and increased productivity that allows output to expand with fewer new hires.”
Austin, Denver, San Antonio and parts of Florida and the broader Sun Belt metros are still digesting heavy apartment deliveries, which is pressuring rents and keeping vacancy elevated.
