Economic volatility and ample supply weighed on third-quarter results, major multifamily leaders said in recent earnings reports.
The apartment industry has seen a broad deceleration in rent growth due to employment uncertainty, decreasing household formations and lower consumer confidence, per UDR, while MAA’s CEO underlined concerns about the soft job market.
Echoing a theme reported by other REITs, Camden continued to see issues with new lease rents as a result of supply. It benefited, though, from robust demand, recently driven by strong retention, itself driven in part by fewer move-outs to buy a home. EQR posted its highest Q3 renewal rates ever, and noted its core resident base, people with college degrees, had an unemployment rate of 2.7%.
UDR saw Sun Belt markets lag, and MAA has a foothold in major Sun Belt areas where high numbers of units have been delivered in recent years, making it perhaps the most vulnerable to new supply among its multifamily peers.
The federal government layoffs and shutdown are hitting the Washington, D.C., area, AvalonBay and EQR leaders noted.
“A combination of federal job cuts and the National Guard deployment, followed by the government shutdown, has created a lot of uncertainty in the local market,” EQR’s CEO Mark Parrell said in an earnings call. “Most of the pressure is being felt in the district and in pockets of Northern Virginia.”
Still, competitive housing supply in D.C. is set to tighten in 2026, and Parrell said he sensed “in the long term, the federal government will continue to be a job engine.”
AvalonBay has recently been selling off its D.C. properties but said its Northern Virginia assets have been performing better, while MAA said it saw Richmond, Virginia, and the D.C. region remain strong.
Meanwhile, the artificial intelligence industry is buoying demand in the San Francisco area. Essex, whose portfolio is located exclusively on the West Coast, reported its best performance in Northern California — in particular San Francisco and Santa Clara counties — stemming from a swell of AI startups in the region.
EQR’s Parrell said major coastal areas were driving growth as workers return to the office, and cited San Francisco, the “epicenter of the AI technology revolution,” as its top market for 2025
Read on for Multifamily Dive’s full third-quarter REIT earnings coverage.
