Vacancy rates clearly have an impact on rents. When there are more rental units available in a given market, landlords have to compete to gain tenants, such as offering concessions. Even if a landlord doesn’t lower rents outright, offering just one month for free lowers the effective rent for a given unit.
So which markets are currently seeing a decline in effective rents, and which are currently experiencing high vacancy? Finally, which markets are likely to see higher vacancy in the future, which could mean future rent declines?
30 Markets Where Rents Are Declining
By using rental data from CoStar and only keeping markets with more than 25,000 rental units, we are able to track the cities with the lowest 12-month change in rents.
Fort Myers, Florida; Austin, Texas; and Raleigh, North Carolina, have the highest declines in effective rent. Also, notice how most of the pandemic boomtowns have also seen a decrease, such as:
- Phoenix, Arizona (-2.25%)
- Tampa, Florida (-1.79%)
- Charlotte, North Carolina (-1.72%)
- Dallas, Texas (-1.43%)
- Atlanta, Georgia (-1.36%)
Now, let’s look at vacancy rates.
Top 30 Markets with the Highest Vacancy Rates
Vacancy rates are related to rent declines. So let’s look at the markets…