Q2 2025 Atlanta Multifamily Market Report

Key Findings

• Net absorption exceeded new deliveries for the first time since mid-2021. The market reached a turning point in Q2 as net absorption surpassed new deliveries, a milestone last seen in mid-2021. This indicates a shift in demand dynamics, signaling that tenant move-ins finally outpaced the pace of construction, helping reduce market oversupply.
• Vacancy remained high, especially among high-end units. Despite improving demand, vacancy rates remained at 12.0% market-wide, well above the national average of 8.2%. Class A properties, although seeing strong demand, still had a 12.5% vacancy rate due to a large number of recent completions.
• Early signs of rent recovery began to emerge. Q2 marked a projected inflection point for rents, with expectations that year-over-year rent growth would return to positive territory by Q3 2025. Though asking rents were still down -0.4% year-over-year at the end of Q2, submarkets like Eastside Atlanta were already showing positive growth of 3%, signaling a localized rebound.

 

By the Numbers

• Sales Volume: $1.3B
• Average Sale Price Per Unit: $216K
• Cap Rate: 5.5%
• Vacancy Rate: 12.2%
• Rent Growth: (0.9%)
• Average Market Asking Rent Per Unit: $1.6K
• Units Under Construction: 16.8K
• Units Delivered: 4.6K
• Units Absorbed: 6.9K | Q2 2025 | Source: CoStar Group, Inc.

 

Demand Rebound: Net absorption outpaces new deliveries for the first time since mid-2021.

 

Atlanta Demographics

• Unemployment Rate: 3.4%
• Current Population: 6,440,846
• Households: 3,295,044
• Median Household Income: $90,963

 

The Atlanta metro continues to draw significant population growth, ranking eighth nationally between 2023 and 2024 with the addition of approximately 75,100 new residents. Attracted by lower living and business costs compared to coastal markets, newcomers are also responding to robust employment opportunities—metro Atlanta’s job growth has nearly doubled the national average since early 2020. The region is home to a well-educated workforce, with 42% of adults holding at least a bachelor’s degree, and boasts a median household income of $87,000, notably higher than the U.S. average.

 

Market Performance

In Q2 2025, Atlanta’s multifamily market showed early signs of a rebound as net absorption outpaced new deliveries for the first time since mid-2021. This marked a critical shift in market dynamics, indicating that renter demand was finally starting to catch up with the rapid pace of construction seen over recent years. Despite this progress, vacancy remained elevated at 12.0%, well above the national average of 8.2%, with the luxury segment (4 & 5 Star) still struggling under the weight of recent supply additions.

 

Rents showed tentative signs of recovery during the quarter. Although asking rents were still down 0.4% year-over-year, several submarkets, most notably Eastside Atlanta, reported positive rent growth, suggesting localized strength. On the construction front, activity moderated slightly, with 2,100 new units delivered—about half the quarterly average seen from 2021 to 2023. Investment sales volume remained sluggish amid high interest rates and valuation uncertainty, though cap rates began to stabilize. Overall, Q2 2025 represented a potential inflection point, with improving fundamentals hinting at a slow but steady recovery ahead.

 

Performance By Class Sector

Source: CoStar Group, Inc.

	Vacancy Rate	Units Under Construction	Asking Rent Per Unit
Class A	12.5%	12,327	$1,865
Class B	11.0%	2,929	$1,503
Class C	12.7%	–	$1,287

 

Atlanta Multifamily Supply & Demand Dynamics

Source: RealPage

 

Construction

Atlanta Properties Under Construction

 

Construction activity in Atlanta’s multifamily market moderated notably, with 2,100 new units delivered, marking the lowest quarterly total since early 2021. While this reflected a slowdown from the elevated delivery volumes of previous years, it still added to the already elevated vacancy rates. The pipeline remained active, with over 32,000 units under construction, signaling that supply-side pressure will persist even as demand begins to recover.

 

Construction Starts (Units)

Source: CoStar Group, Inc.

 

Under Construction (Units)

Source: CoStar Group, Inc.

 

Sales Activity

Investment activity remained subdued in Q2 2025, with just under $600 million in transaction volume, reflecting ongoing caution from investors amid elevated interest rates, valuation uncertainty, and soft fundamentals—especially in the Class A segment. Institutional capital largely stayed on the sidelines, resulting in limited bidding activity and slower deal flow. However, cap rate expansion showed signs of stabilizing, hinting at a narrowing bid-ask gap between buyers and sellers. While major trades were limited, some well-located and value-add assets still drew interest from opportunistic buyers. This stabilization suggests the market may be approaching a turning point, potentially setting the stage for a modest recovery in sales activity later in the year, especially if financing conditions improve.

 

Atlanta Multifamily Dollar Volume vs 10-Year Treasury Yield

Source: Matthews™, Real Capital Analytics

 

Atlanta Multifamily Price Per Unit vs 10-Year Treasury Yield

Source: CoStar Group, Inc.