Shafiq Hirani CCIM reports that new luxury apartments captured 68% of U.S. rental absorption in Q2, with 111,000 units leasing up. Developers are offering two months free rent and waived fees to fill them, pulling renters away from older buildings.
The reason is straightforward: new properties are winning the renters. 4- and 5-star properties, the newest luxury inventory, accounted for more than 111,000 units of 2nd-quarter absorption. That is nearly 68% of all national absorption going into the newest, most expensive buildings. Those buildings are offering concessions: 2 months free, waived fees. When a renter can get a brand-new unit with a month or 2 free, That pulls demand away from established buildings, including yours.
