The Census Bureau released its quarterly report on home ownership and occupancy for Q3. It stated that the rental housing vacancy rate was 6.6 percent, up from a level of 6.3 percent in Q2 2023 and also up from a reported level of 6.0 percent in Q3 2022.
Parsing the vacancy data
The headline vacancy rate reported by Census is for all rental housing in the country, both single-family and multifamily. Census breaks down this figure in various ways, including by the number of units in the building. The chart, below, illustrates this comparison.
The chart shows that the vacancy rate for multifamily housing with 5 or more units per property as measured by the Census Bureau moved higher in Q3 to 7.9 percent. The single-family rental vacancy also moved higher, rising 0.1 percentage points to a level of 5.6 percent.
Note that Apartment List reported that the multifamily rental vacancy rate at the end of September was 6.4 percent. By contrast, Yardi Matrix reported the multifamily rental vacancy rate in September as 5.0 percent. While the Census Bureau attempts to capture all rental housing in the country, other data sources may focus on subsets of the market like professionally managed properties and so they come up with different results.
The Census Bureau reported that the rental vacancy rate in the core cities of the Census Bureau’s Metropolitan Statistical Areas (MSAs) was 7.3 percent in Q3 2023, up from 7.1 reported for the previous quarter. The rental vacancy rate in the suburbs of the MSAs was 6.1 percent in Q3 2023, more than reversing the decline reported for Q2. These trends are shown in the next chart, below.
The rental vacancy rate history for each of the Census regions is shown in the next chart, below. Vacancy rates were reported to rebound from Q2’s declines in both the Midwest and the South, although they remain below the vacancy rates reported in Q1. The Midwest vacancy rate was reported to be 7.2 percent while that in the South was reported to be 8.1 percent. After rising last quarter, the vacancy rate in the Northeast was reported to fall to 4.3 percent. However, this rate is still below that reported for the Northeast in Q1. The vacancy rate in the West was reported to rise to 5.8 percent, up from 5.0 percent in Q2 and 4.3 percent in Q1.
Census reported that 68.5 percent of vacant rental units were in structures with 2 or more units. Only about 14 percent of the vacant multifamily units had 3 or more bedrooms, with 1 bedroom units comprising 41 percent and 2 bedroom units comprising 43 percent of vacant stock. The median unit vacancy duration for multifamily properties in Q3 2023 was 2.2 months, up from 2.0 months one year earlier.
Rentership rate falls
The Census Bureau reported that 34.0 percent of the country’s 130,386,000 occupied housing units were inhabited by renter households in Q3 2023. This rate is down slightly from that in Q2 as the growth in the number of homeowning households outpaced the growth in the number of renter households during the quarter.
The history of the number of occupied housing units and the share of renter households since 2012 is shown in the next chart, below. The chart shows that the reported number of renter households has been stuck in the range of 41 to 44 million since 2014, although the reading for Q3 2023 of 44,372,000 set a new all-time high for the second quarter in a row.
The number of homeowning households also set a record high this quarter, reaching 86,014,000. This finally exceeded the, possibly anomalous, high reached in Q2 2020 when pandemic restrictions made the gathering of statistical data difficult.
The number of renter-occupied housing units was reported to rise by 52,000 in Q2. The number of owner-occupied housing units was reported to rise by 233,000.
Rents reported rising
The Census Bureau also tracks the median asking rents for the country as-a-whole. The history of their findings is shown in the next chart, below. Census reported that rents rose $17 per month in Q3 2023, reversing last quarter’s reported decline. Census reported the national median rent to be $1,462 per month, a gain of 1.2 percent.
By contrast, Yardi Matrix reported that the national average apartment rent in September was $1,722 per month. Apartment List reported the national average apartment rent in September as $1,371 per month.
The last chart, below, shows the history of the median rent by Census region as a percentage of the national median rent. Rents in the South were reported to be unchanged for the quarter while rents rose in the other three regions of the country. Rents were 3.9 percent higher in the Northeast, 4.9 percent higher in the Midwest and 8.1 percent higher in the West.
The Census report is called Quarterly Residential Vacancies and Homeownership, Third Quarter 2023. It is available here.
