CBRE’s latest multifamily research shows an improvement in market fundamentals as U.S. apartment rents grew slightly in the third quarter and new construction continued to slow. Average apartment rents rose by 1% year-over-year and 0.5% quarter-over-quarter to $2,268, the brokerage found. Positive performance in across the Midwest, Northeast and Pacific regions supported rent growth, with San Francisco recording the largest year-over-year jump at 9.4%.
Multifamily construction completions totaled 84,300 units during the quarter, falling 11% compared to the same quarter of 2025. However, completions outpaced net absorption for the first time since the fourth quarter of 2025, contributing to an increase in the overall vacancy rate by 40 basis points to 4.7%. Total net absorption in the third quarter was just 8,747 units, down from 42,166 a year ago, and CBRE expects absorption to continue to fall in the coming quarters as construction slows further.
Investment volume in the sector soared 140% year-over-year to $112.3 billion in the third quarter, but the increase was mainly driven by the $69.6 billion merger of Avalon Bay and Equity Residential. “With peak supply now behind us and rent growth poised to strengthen, the sector is positioned for a gradual recovery in transaction activity,” noted Kelli Carhart, Head of Multifamily Capital Markets for CBRE in a statement.
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