Free concessions are at their highest level in more than 2 years as new downtown luxury apartment complexes flood the market.
In Nashville, intensified competition to occupy rental units has prompted a surge in apartments citywide, with many now providing incentives like waived fees and several months of free rent.
Joel Sanders, Founder and CEO of Apartment Insiders, stated:
“Nashville currently has 37,000 apartment units that are under construction and the majority of those are luxury apartments”.
As a consequence of the construction boom, property managers are competing for tenants and many apartment complexes are stepping up their game by offering incentives of up to three or four months of free rent.
In October of 2023, around 30% of rental listings on Zillow featured concessions, this indicates a substantial shift in the dynamics of the rental market.
“About half of the apartment communities in the Nashville market are offering rent concessions,” Sanders mentioned.
The latest information from MRI Software’s ApartmentData.com reveals that a remarkable 43% of Nashville’s Class A housing is currently providing some kind of rent concession.
During the pandemic era, there was an increase in concession as a direct result of decreased renter demand. However, today we are observing a contrasting situation: the demand for rental housing is robust, yet there has been a significant uptick in the supply.
In a market saturated with options, apartments are enticing tenants by offering various deals and incentives to attract potential renters. For them, providing free rent is more convenient than incurring losses due to lower vacancy rates.
It’s anticipated a further influx of apartment deliveries in 2024, and it wouldn’t be surprising if we eventually witness incentives offering up to five months of free rent in Nashville.