The multifamily market nationwide showed signs of stabilization in the second quarter of 2023 with a rebound in absorption and modest uptick in vacancy, according to CBRE’s latest research. Rents increased 2.6% year-over-year, in line with the pre-pandemic five-year average.

The multifamily vacancy rate rose by 10 basis points quarter-over-quarter in Q2 2023 to 5.0%. This was a slower increase than the 30-bp rise in Q1 2023 and the 70-bp increase in Q4 2022. Notably, net absorption escalated to 70,200 units in Q2 2023, the highest since Q1 2022, indicating a recovery in renter demand.

“Despite a heavy supply pipeline, we are seeing renter demand remain solid as vacancy and rent growth stabilize across most markets,” said Kelli Carhart, leader of multifamily capital markets for CBRE. “With inflation easing, we anticipate increased investment activity in the second half of 2023, notwithstanding capital markets volatility.”