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  • Writer's pictureRealFacts Editorial Team

The Nation’s Worst Occupancy Markets See Vacancies Rise



Vacancies in apartment complexes across the southern United States have surged, reflecting the challenges faced by these markets in absorbing a significant influx of new units. According to RealPage Market Analytics, May 2024 saw over 749,600 apartment vacancies nationwide, with a pronounced concentration in the Gulf Coast states and the Southeast. Eleven markets reported occupancy rates at or below 92%, indicating a growing concern for property managers and investors alike.



Myrtle Beach: Leading the Decline


Myrtle Beach-Conway-North Myrtle Beach emerged as the weakest performer, with occupancy plummeting to 90.3%, well below the regional average of 93.2%. Nearly 45,500 units stood vacant, underscoring the area's struggle to attract and retain renters amid an overabundance of available housing.


Major Markets Under Pressure


San Antonio, a major urban center, saw significant backtracking in occupancy, which fell to 91.2%, leaving 210,300 units vacant. This marked a substantial increase in unoccupied apartments, reflecting the broader trend of supply consistently outpacing demand since the third quarter of 2022.


The Southeast Slump


Several other markets in the Southeast also reported troubling vacancy rates. Augusta and Baton Rouge both saw occupancy rates tied at 91.4%, with 29,600 and 46,600 vacant units, respectively. Jacksonville, another large market, faced 131,400 vacant units, translating to an occupancy rate of just 92%.


Smaller Markets Feel the Pinch


Smaller markets have not been immune to the vacancy surge. Memphis, with 101,400 vacant units and an occupancy rate of 91.8%, Cape Coral-Fort Myers (92%), Colorado Springs (92%), Corpus Christi (91.5%), Shreveport (91.7%), and Lubbock (91.7%) all reported significant vacancy numbers.


Supply Outpacing Demand


The core issue driving these high vacancy rates is the accelerated supply of new apartment units, which has consistently outpaced demand since late 2022. This has been particularly pronounced in the Gulf Coast and Southeast markets, where new developments have flooded the market. Shreveport is an exception, having not seen new units since mid-2019, yet it still struggles with a 91.7% occupancy rate, indicating underlying economic or demographic challenges.


As the South grapples with this oversupply, the rental market faces a critical period of adjustment. Property managers and developers must navigate these challenging waters, balancing new supply with effective demand strategies to stabilize occupancy rates and mitigate the financial impact of high vacancies.


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