Coastal Tech Markets Lead Apartment Rent Recovery
After six months of sliding occupancy, the U.S. apartment market posted a modest rebound in January 2026, according to RealPage report.
National occupancy ticked up 10 basis points to 94.7%, ending a long streak of declines. While this is still slightly below year-ago levels and down 100 basis points from the April 2025 peak, the gain reflects falling completion volumes, which reduced downward pressure on rents.
The national average rent increased 0.2% month-over-month to $1,858, marking the first uptick in seven months, but annual figures remain slightly negative, down 0.4% from January 2025. Regionally, the Midwest and Northeast are outperforming, with rents climbing 2% and 0.9%, respectively, while the South and West continue to struggle amid high supply and persistent demand pressures. The South, in particular, has not recorded annual rent growth since mid-2023, underscoring the challenges in markets with abundant new units and elevated completions, according to RealPage.
Certain supply-heavy markets bore the brunt of the downturn. Austin saw rents decline 7.6% in the past year as developers added more than 16,900 units, a 5.1% increase in inventory. Denver, Phoenix, Charlotte and Nashville faced similar challenges, with annual rent drops ranging from 3% to 6%, despite ongoing apartment demand. Tourism-dependent markets such as Tampa also experienced notable rent cuts, highlighting how discretionary spending patterns in leisure-driven areas can ripple into the multifamily sector.
Meanwhile, tech-focused coastal hubs painted a brighter picture. San Francisco led the nation with rents rising 8.7%, as inventory grew just 0.6%. San Jose followed with a 4.7% gain and New York City posted a 4.3% increase. These metros are benefiting from concentrated technology hiring, including momentum in artificial intelligence sectors, which is fueling renewed renter demand and supporting price recovery, the report said.
Other markets also posted notable gains, though on a smaller scale. Virginia Beach rents rose 4%, Chicago 3.7% and St. Louis 2.8%, each with limited new supply helping absorb rising demand. Midwest cities, including Milwaukee, Cincinnati, Cleveland and Minneapolis, all posted annual rent gains above 2%, highlighting pockets of resilience outside the coastal tech centers and demonstrating that localized dynamics are increasingly shaping the national apartment market picture.
Source: GlobeSt/ALM