MARKET SNAPSHOT
There are 1,848 units currently in the pipeline, which will increase Boise’s multifamily inventory by 4.4%. Over the past decade, Boise’s market-rate multifamily inventory grew by 106.5%, with upper-tier properties driving much of this growth, as their inventory quadrupled during the period. Another roughly 1,800 luxury units are under construction, expected to expand the existing upper-tier supply by 11.7%. However, the region’s recent supply surge is quickly tapering off. Declining construction starts signal a sharp reduction in deliveries over the next two years, with the number of units underway now nearly 70% below the late 2022 peak and approximately 45% below the historical average. Ongoing financing challenges continue to hinder new construction, and multifamily starts fell by over 40% in 2024 while new completions are anticipated to decline by around 65% in 2025.
Meridian has been a primary focus for apartment developers over the past decade, accounting for approximately half of all new construction in Boise. This boom has resulted in Meridian’s inventory being heavily skewed toward upper-tier communities, with most of the roughly 350 units in its pipeline classified as luxury properties. Meanwhile, Caldwell, which represents just 6% of the market’s existing inventory, is emerging as a new growth area, with 40% of 2025’s upcoming deliveries concentrated in this submarket.
Prospective renters are actively seeking units, as evidenced by increased leasing activity and a significant rise in absorption. Boise recorded approximately 2,550 units absorbed over the past year—a marked improvement from the previous low of nearly 1,400 units in 2023 and well above the long-term average of 910 units. The 2024 total also approached the market’s all-time high, underscoring robust renter demand. These trends are expected to continue into 2025, with net absorption anticipated to outpace deliveries for the first time since 2020.
The overall occupancy rate has been stabilizing since early 2023 and has remained near 93% during this period. With new deliveries slated to slow considerably in the coming year, the downward pressure on occupancy trends appears to have peaked. Improving supply-and-demand dynamics combined with the market’s rapidly growing population, which ESRI estimates will increase by 10% by 2029, should drive gradual occupancy gains over the short-term.
Average market rents in Boise rose by 1.6% over the past year, a significant slowdown compared to the record gains of over 12% recorded in mid-2021. However, new deliveries are slowing significantly, and leasing activity is accelerating, suggesting that occupancy rates have likely bottomed out. Additionally, under construction inventory has dropped well below the historical average for the first time since 2016, signaling an impending reduction in new competition and concessions in the near term.
Nationally, year-over-year rent growth has also moderated, standing at 1.1%. Over the past five years, Boise’s annual rent growth has averaged 3.9%, with cumulative growth reaching 17.2%, nearly matching the national average of 18.4%. By the end of 2025, rents in Boise are projected to grow at an annual rate of 3.5%, a rate comparable to the market’s ten-year average of 3.7%. This forecast reflects the effects of prior rent declines during the supply surge, which reduced landlords’ pricing power but now set the stage for recovery.
Currently, average market rents in Boise are approximately $1,550 per month, well below the national benchmark of around $1,700 and roughly 5% less than regional peers such as Salt Lake City and Reno. This relative affordability, combined with stabilizing market conditions, positions Boise for gradual improvement in rent performance and occupancy rates in the coming years.
12-month period ending November 2024
Boise’s multifamily market is set to stabilize and expand further in 2025, driven by a significant decrease in new supply, strong renter demand, and sustained population growth. Construction activity has slowed sharply, with under construction inventory dropping 55% year-over-year and new completions declining by nearly 65%, with only around 1,060 units to be delivered in 2025. This dramatic reduction in supply is anticipated to ease competitive pressures, reduce concessions, and create favorable conditions for occupancy and rent growth.
Demand fundamentals remain solid, with net absorption forecast to outpace completions for the first time since 2020, signaling strong leasing activity. Average occupancy, which has stabilized near 93% since early 2023, should improve gradually throughout the coming year as the pace of new deliveries slows. Boise’s rapidly growing population and quality-of-life amenities will further fuel demand for rental housing, strengthening the market’s fundamentals.
Rent growth is projected to recover to historical norms, with a 3.5% annual increase anticipated by the end 2025. This rebound reflects recovery from prior supply-driven rent declines, as reduced construction activity sets the stage for stronger gains. Boise’s relative affordability, with average rents well below those in higher-cost regions, will continue to attract renters, further boosting demand. Submarkets such as Meridian and Caldwell will play significant roles in shaping the market’s trajectory. Caldwell, in particular, is emerging as a key growth hub, with 40% of 2025’s deliveries concentrated there despite accounting for just 6% of the market’s total inventory.
Combined with Boise’s robust economy and thriving job market, these factors position the multifamily sector for sustained growth and ongoing investor interest in the years ahead.
