News Summary
Phoenix is witnessing a strong rental market despite a slight decrease in occupancy rates. Rental demand is high, with many tenants opting to renew leases rather than move. The market averages about $1,500 per unit, reflecting a 3% decrease in prices. With more than 20,000 new apartments completed and 28,000 projected by 2025, the competition for rentals remains fierce, with each vacant apartment attracting around 8 applicants. Additionally, while the job market has faced minor declines, remarkable construction activity continues to develop housing options, highlighting the resilience of Phoenix’s real estate landscape.
Phoenix is experiencing a robust rental market, even as new apartment construction continues to roll out. The overall occupancy rate in the city has decreased slightly by 0.6%, but that hasn’t deterred rental demand, with tenants opting to stay in their homes rather than moving. This trend may be indicative of a competitive rental landscape where rent prices are currently averaging around $1,500 per unit, down by 3% from previous averages.
In the latest rental statistics, 57.7% of tenants in Phoenix are choosing to renew their leases — an increase from 57.1% a year ago. Meanwhile, each vacant apartment in the area is attracting an average of 8 competing applicants, a number that has remained stable since last summer. Despite the gradual rise in construction activity, which saw a 1.7% increase, this rental market remains tightly contested. Currently, renters have 8% of the apartment stock available to choose from, further emphasizing the ongoing demand.
It is taking an average of 43 days to fill a vacant unit, with renters benefiting from an additional three days to submit their applications compared to the previous year. This extended time suggests an effort to accommodate the growing number of applicants vying for limited rental options. Despite these conditions, the job market in Phoenix recently experienced a decline, losing 7,500 jobs in the last year, primarily due to layoffs in the tech sector. However, these losses are considered statistically insignificant, with experts confident that re-employment opportunities will be available given the job-rich environment of the region.
Construction Boom
In terms of housing availability, Phoenix saw the completion of over 20,000 apartment units in the past year, demonstrating significant activity in the construction sector. One notable development is a 19-unit apartment complex named “Stacks on Polk,” constructed from recycled shipping containers in east Phoenix. The monthly rent for these units starts at $1,250, and the project achieved a 30% reduction in construction costs due to lower labor expenses sourced from a facility in Mexico.
Looking ahead, it is projected that an additional 28,000 apartment units will be completed in Phoenix by 2025, indicating a continuous effort to expand housing options amidst rising demand.
National Comparisons
When analyzed on a national scale, Phoenix is performing comparably to other challenging rental markets. In Chicago, renters face competition from 16 applicants for each vacant unit, with an average lease period of 29 days. Even more competitive, Miami reports 19 applicants per vacant unit and a 32-day average vacancy period. Cities like Manhattan, NY, have seen their applicant numbers rise to 12, while Silicon Valley, California has 14 applicants competing for each apartment.
Overall, Phoenix’s dynamic rental market, coupled with ongoing construction projects, underscores its appeal in the broader context of rental trends across major U.S. cities. This situation highlights the balance between supply and demand, with the local economy continuing to adapt despite fluctuations in employment and market pressures.
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Additional Resources
- AZ Big Media: Tough Renting in Phoenix
- AZ Central: Downtown Phoenix Apartment Boom
- KTAR: Recycled Shipping Container Apartments
- AZ Family: Rent Prices and Job Growth in Phoenix
- Copper Courier: Finding Rentals in Phoenix
- Wikipedia: Phoenix, Arizona
- Google Search: Phoenix rental market
- Google Scholar: Phoenix real estate
- Encyclopedia Britannica: Phoenix, Arizona
- Google News: Phoenix real estate
Author: STAFF HERE PHOENIX WRITER
The PHOENIX STAFF WRITER represents the experienced team at HEREPhoenix.com, your go-to source for actionable local news and information in Phoenix, Maricopa County, and beyond. Specializing in "news you can use," we cover essential topics like product reviews for personal and business needs, local business directories, politics, real estate trends, neighborhood insights, and state news affecting the area—with deep expertise drawn from years of dedicated reporting and strong community input, including local press releases and business updates. We deliver top reporting on high-value events such as the Waste Management Phoenix Open, Cactus League Spring Training, and Arizona State Fair. Our coverage extends to key organizations like the Greater Phoenix Chamber of Commerce and Visit Phoenix, plus leading businesses in technology and healthcare that power the local economy such as Intel and Banner Health. As part of the broader HERE network, including HERETucson.com, we provide comprehensive, credible insights into Arizona's dynamic landscape.
