In a significant shift within the multifamily housing market, nearly 16.6% of stabilized apartments across the nation offered concessions in January, as reported by RealPage Market Analytics. This marks an increase from December and represents the highest rate of concession activity since mid-2014, revealing how heightened supply and declining renter demand are reshaping the landscape for apartment landlords.
As landlords face increasing competition, they are resorting to generous discounts to attract tenants. The average concession in January reached 10.7%, equivalent to about five weeks of free rent. Interestingly, this figure mirrors the average from the fourth quarter of 2025 but shows a slight uptick compared to October. With rents modestly rising by only 0.2% in February-ending a six-month decline-landlords are grappling with a year-over-year rent decrease of 1.5%. Concurrently, the national vacancy rate hit a record high of 7.4%, suggesting that the recent uptick in rents may be seasonal.
“The high levels of new deliveries-especially in the Sun Belt-continue to pose a structural challenge,” stated Paul Fiorilla, associate director of secondary research at Yardi, in the company’s February apartment report. Although new construction starts and deliveries have tapered from peak levels, a robust volume of units remains in the leasing process, prolonging the time it takes to absorb this inventory.
The market is further complicated by various economic pressures, including a softening job market, reduced domestic migration, and slowing immigration trends, which have dampened household formation. Fiorilla noted that occupancy rates have fallen year-over-year in 28 of the top 30 markets Yardi analyzes, underscoring the market’s strained conditions.
Adding to the discourse, rental housing economist Jay Parsons remarked that the current landscape has conditioned renters to expect attractive offers. He anticipates that as effective rent growth numbers emerge from various providers, the potential for incremental improvement exists, even amid high concession rates. Drawing parallels to 2010-when unemployment rates soared beyond today’s figures-Parsons emphasized that the current absorption rates are significantly better, though the overwhelming supply of about 1.4 million new units remains a pressing concern, representing the highest count over any three-year span since the 1970s.
The nature of these concessions tends to favor free rent for extended periods and gift cards for prospective tenants, but Parsons clarified that rent concessions impact the reported income of the building differently than marketing concessions. “When you do a rent concession, that’s going to hit the rent roll. It’s distinct from what they call a marketing concession, which is essentially a giveaway,” he explained. This nuance affects landlords’ strategies, as those who opt for rent concessions may find it more challenging to revert to standard pricing once discounts are established.
As the multifamily market continues to navigate these shifting dynamics, all eyes will be on the evolving strategies landlords adopt to remain competitive while fostering tenant interest amid increasingly challenging conditions.
Tags: Multifamily market, rent concessions, apartment rentals, RealPage Market Analytics, housing trends, vacancy rates, landlord strategies.
Original Source: https://www.cnbc.com/2026/03/17/apartment-concessions-hit-highest-level-in-over-a-decade.html
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Publish Date: 2026-03-17 19:33:00
