Phoenix’s multifamily market showed signs of recovery in Q4 2024, with rising renter demand stabilizing occupancy rates. Net absorption reached 19,000 units, well above pre-COVID averages, driven by luxury lease-ups and a strong rebound in midpriced 3-star properties. However, vacancies rose to 11.6% as new supply outpaced leasing activity.
Construction remains a challenge, with 25,000 units delivered and 27,000 more underway, making Phoenix one of the most aggressively built markets. Luxury properties face rising vacancies, while workforce housing remains more stable. Rents fell 1.8% over the past year, with over half of communities offering concessions. Vacancies are expected to peak in 2025, with rent growth likely rebounding by 2026 as supply balances out.
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