A bit of momentum? That’s what rents in Detroit’s multifamily sector are seeing, according to the latest research from Yardi Matrix.
According to Yardi Matrix’s March Detroit multifamily report, the region’s year-over-year rent gains outpaced other key U.S. markets as of the end of January. The Detroit region’s occupancy levels also came in above the U.S. average.
That’s good news for the Detroit-area multifamily sector.
According to Yardi Matrix, the Detroit multifamily market’s average advertised asking rent ticked up 0.1% on a trailing three-month basis through January, settling in at $1,335. During the same time, the average advertised asking rent for the United States dipped 0.2%, falling to $1,741.
Detroit’s average apartment asking rents rose 1.8% on a year-over-year basis, also outpacing the U.S. national gain of 0.2%. Among the major metropolitan areas tracked by Yardi Matrix, Detroit placed sixth for year-over-year growth, trailing only Chicago (3.6%), New York City (3.3%), Minneapolis-St. Paul (2.7%), Kansas City (2.5%) and San Francisco (2%).
Advertised asking rents for the working-class renter-by-necessity segment in the Detroit area inched up 0.1% on a trailing three-month basis through January to $1,269. The average for the lifestyle segment fell 0.3% to $1,942.
The difference between the two multifamily types was even more pronounced on a year-over-year basis. Yardi Matrix reported that the average advertised asking rent for the renter-by-necessity segment rose 2.4% on a year-over-year basis, while the average advertised asking rent for the lifestyle segment dropped 1.6%.
Detroit’s December occupancy rate fell 20 basis points year-over-year to 94.7%. This figure, though, was above the U.S. average of 94.5%.
Among the 45 submarkets tracked by Yardi Matrix, Bloomfield Hills/Birmingham remained the most expensive. Advertised multifamily asking rents here rose 4.4% on a year-over-year basis to $1,888 a month.
Yardi Matrix reported, too, that developers added 1,778 units to Detroit’s multifamily stock during the last year. Completions accounted for 0.8% of existing inventory. That figure fell below the national average of 3.1%.
Lifestyle assets made up nearly 60% of all new units added to the Detroit metro area in the last year, Yardi Matrix reported. Renter-by-necessity products accounted for about 12%, while fully affordable projects accounted for about 29%.
Yardi Matrix said that it expects the Detroit metropolitan area to gain an additional 1,850 units by the end of 2026. The Detroit market had 4,313 apartment units under construction as of January, while developers had another 27,000 units moving through the planning and permitting stages. Lifestyle assets accounted for about two-thirds of all units in the construction pipeline.
