Q4 2024 Atlanta Multifamily Market Report
Atlanta Key Findings
- Apartment demand is strongest for higher-tier properties, with this class leading the way in absorption volume.
- The market has recently been affected by an influx of new properties, specifically in urban submarkets like Midtown and Downtown.
- Rent growth increased the most in suburban areas. For example, the Haralson County submarket recorded rent growth increasing by 6.5%.
By the Numbers
2024 | *represents change from Q3 2024 | Source: CoStar Group
- Sales Volume: $5B ↑
- Average Sale Price per Unit: $208k ↑
- Cap Rate: 5.6% ↑
- Vacancy Rate: 12.4% ↓
- Rent Growth: -1.6% ↑
- Average Market Asking Rent per Unit: $1,633 ↓
- Units Under Construction: 18,928 ↓
- Unit Delivered: 4,646 ↓
- Units Absorbed: 4,939 ↓
Chicago Demographics
- Unemployment Rate: 3.5%
- Current Population: 6,397,525
- Households: 2,389,450
- Median Household Income: $88,391
New residents are still relocating to Atlanta, and the metro recorded the third-highest uptick in population growth from 2022 to 2023. The metro’s lower living and business costs are enticing to both residents and employers, and Atlanta boasts several different employment opportunities. Amazon, HelloFresh, and Home Depot aided hiring for blue collar jobs, while white collar hiring increased with the presence of Microsoft, Google, and Norfolk Southern.
Market Performance
Atlanta’s multifamily sector has recorded positive absorption levels for seven consecutive quarters. The increase in apartment demand was most prevalent for higher-tier apartments, with around 18,000 units absorbed in this segment. However, absorption has not been able to keep up with new developments in the metro. There are currently 18,000 units on the way, but construction activity is expected to decline during 2025. As delivery levels slow down, absorption will return to normal activity.
Due to the imbalance between new supply and absorption, Atlanta’s vacancy rate has increased since Q1 2023. With the current vacancy rate of 12.4%, the metro’s rent decreased by -1.6% year-over-year. Areas with positive rent growth are located in the outlying submarkets, while Atlanta’s urban areas are struggling with negative rent activity. However, as new supply cools down, forecasts expect rent growth to reach 4% by 2026.
Construction
While the Atlanta metro is undergoing an increase in developments, new supply is heaviest in its urban submarkets. Downtown Atlanta, specifically, is recording one of the greatest increases in new developments with 20% of its inventory under construction. Throughout 2025, new supply will cool down, which should aid the metro’s vacancy rate and rent growth.
Sales Velocity
Around 32,000 units changed hands throughout 2024, which made up 6.2% of Atlanta’s inventory. More than half of the year’s transactions were by national firms as they sought properties in Atlanta’s urban area.
