In Multifamily Leasing, 2023 Looked a Lot Like 2019

Latest data from MRI Software shows that traditional seasonality has returned

Solon, Ohio – January 18, 2024 – Demand for crystal balls might just wane in 2024: According to the latest Market Insights report from PropTech firm MRI Software, multifamily leasing in 2023 reflected typical pre-pandemic seasonal patterns of peaks and dips.

The data, compiled from over one million market-rate units over five consecutive years, showed important similarities between 2023 and 2019, such as drops in pricing toward the end of the year. In both years, rent increased by nearly 7% from January to an in-year peak, then fell from that peak by 2.2% by the end of the year, while annual rent growth exceeded 4%.

Nevertheless, there are a few notable differences between the two years. These include:

• Residents choosing to renew at a 10% higher rate in 2023 than in 2019.
• Lower concession volumes in 2023 but far higher concession values than in 2019.
• Better rent-payment performance in 2019 than 2023 (a difference of 1.5%).
• A significantly higher ratio of ACH to credit card payments in 2019 than 2023, despite fees associated with credit card payments that renters usually must swallow.

“Budget-wise, the return to seasonality is a relief for landlords,” says Brian Zrimsek,
Industry Principal at MRI Software. “It’s much easier to make forecasts when established market patterns reemerge.

“But I wouldn’t throw the crystal balls away just yet,” he adds, pointing to the effects of new deliveries in many markets, along with such variables as interest rates, remote-work policies, potential public health outbreaks, conflicts in the Middle East and Eastern Europe, and the upcoming election.

Nevertheless, Zrimsek is willing to make a prediction based on the data at hand. “I’m anticipating that rent growth will align with pre-pandemic norms,” he states. “That means small but steady increases.”

The full report can be downloaded here.

About MRI Software
MRI Software is a leading provider of real estate software solutions that transform the way communities live, work and play. MRI’s open and connected, AI-first platform empowers owners, operators and occupiers in commercial and residential property organizations to innovate in rapidly changing markets. MRI has been a trailblazer in the PropTech industry for over five decades, serving more than six million users worldwide, including the public and affordable housing sector. Through innovative solutions and a rich partner ecosystem, MRI gives real estate companies the freedom to realize their vision of building thriving communities and stronger businesses. For more information, please visit www.mrisoftware.com.

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