Apartment demand is rising across U.S. several markets through the first half of 2023, an encouraging turn after demand underperformed last year. Dallas-Fort Worth, Houston, Phoenix, Atlanta and Austin, Texas, all report rebounding demand. While Dallas-Fort Worth and Houston led the overall ranking, Phoenix enjoyed the biggest recovery, absorbing five times more units in the first half of 2023 than last year.

It’s an encouraging sign for all parties that renters are feeling more confident in signing a lease. Weak net absorption, or the difference in move-ins versus move-outs, in 2022 coincided with stubborn inflation and souring consumer sentiment.

Some renter households elected to stay in place, and many were faced with tough choices about moving in with family or finding a roommate, particularly among mid- to low-tier properties. The rebound in net absorption reflects more units filled at the top end of the market but also captures fewer move-outs among mid- to low-tier properties.

Continued population growth and in-migration is expected to continue to fuel demand. Meanwhile, new construction is expected to relent as developers face elevated construction costs. This should allow vacancies to stabilize and rent growth to return over the next year or two.

Read the full article on CoStar’s [original post].