The Dayton area’s apartments remain tightly occupied as baby boomers continue to downsize and apartments remain popular choices among young professionals.
Apartments in the Dayton market were about 97 percent occupied during the first half of the year, according to Colliers International’s report released this month on the multifamily real estate market.
“This increase came despite the largest amount of new supply in seven years,” the report said.
After years of little new Dayton-area apartment construction — in some communities decades of no new construction — there were 800 new apartment units finished over the past year and there are 1,475 units under construction.
New apartments with high end amenities like the Water Street District in downtown Dayton have been almost completely occupied since they were completed, with developers saying the demand for luxury rentals is coming from downsizing empty nesters and baby boomers, as well as young professionals who are choosing to rent instead of own.
While almost all of the 800 local new apartment units were snapped up as they were built, Colliers said the coming arrival of 1,475 new units will test how deep the demand for rentals goes in the Dayton region.
Despite demand for rentals ticking up in the Dayton area, with occupancy up from 96.3 percent around the end of 2016, rents aren’t significantly rising.
“The year-over-year increase in average rent was only 1.0 percent, well below the five-year average of 2.4 percent,” the report said.
If demand doesn’t keep pace with the sudden influx of new apartments in the Dayton region, then Colliers said rents may fall even further.