MARKET SNAPSHOT
Persistently high interest rates and rising material costs have led to a sharp decline in construction starts over the past year, falling nearly 50% in 2024 to their lowest levels in over a decade. While the current construction pipeline remains slightly above the historical average, it now represents just 4.4% of the total inventory—18% below the cycle peak. Furthermore, the slowdown in construction starts is expected to significantly reduce the pace of new completions in Columbus by late 2025 and into 2026.
Over the past year, new deliveries have been heavily concentrated in the Delaware County, Upper Arlington, and Southern Columbus submarkets, each accounting for just over 20% of total market completions. These suburban areas primarily feature three-story garden-style apartments, catering to growing demand. Delaware County, one of Ohio’s fastest-growing counties, remains a focal point for development, with approximately 2,500 units—representing 18% of the submarket’s total inventory—currently under construction. Of these, 1,300 units are slated for completion this year, yet occupancy rates are expected to rise, driven by strong population growth in the area. The Greater Hilltop submarket is also seeing a surge in activity, with over 1,100 units set to come online in 2025, making it the second-largest contributor to new supply in the metro this year.
Multifamily occupancy in Columbus stabilized in 2024 after two consecutive years of decline, supported by a slowdown in new deliveries and robust renter demand. Net absorption over the past year surpassed the market’s 10-year average by nearly 25%, and projections from CoStar suggest absorption will again exceed historical norms in 2025. As a result, occupancy levels are expected to hold steady throughout 2025, fluctuating within a narrow range of plus or minus 10 to 20 basis points, in line with typical seasonal demand patterns.
Looking ahead, the sharp decline in construction starts—now at their lowest levels since 2014—is expected to significantly reduce new deliveries by 2026. This anticipated slowdown in supply growth is likely to contribute to occupancy gains in the coming years.
Columbus continues to stand out among the nation’s largest multifamily markets, recording steady annual rent growth of approximately 3.0% across all four quarters of 2024—significantly outperforming the national average of 1.0%. This sustained growth is largely attributed to a measured pace of apartment development over the past four years, especially when compared to the rapid expansion seen in Sun Belt markets. Throughout 2024, Columbus consistently ranked among the top 10 major apartment markets for rent growth, alongside peer cities such as Cincinnati and Kansas City. Its balanced supply-demand dynamics and steady economic growth have reinforced the market’s resilience.
Looking ahead, the combination of a measured pace of new deliveries and above-average absorption is expected to further support rent growth. Annual rent gains are projected to edge closer to 4.0% in 2025, reinforcing Columbus’ strong market fundamentals and highlighting its appeal as a stable and resilient multifamily market.
12-month period ending November 2024
The Columbus multifamily market is poised for continued stability in 2025, supported by a balanced supply-demand dynamic and robust renter demand. Net absorption is expected to remain above the 10-year historical average, driven by strong population growth and economic expansion. While new deliveries have been elevated in recent years, the pace of construction starts has slowed significantly, with levels now at their lowest point since 2014. This decline in future supply will help alleviate pressure on occupancy rates, which are projected to remain steady within a narrow range over the next year. Additionally, Columbus’ relatively moderate pace of apartment development compared to high-growth Sun Belt markets has contributed to sustained rent growth, positioning the metro as one of the top-performing rental markets in the nation.
Looking ahead, rent growth in Columbus is expected to maintain its upward momentum, with annual gains projected to approach 4.0% by year-end 2025. The anticipated slowdown in new deliveries by 2026 is expected to further strengthen market fundamentals, easing supply pressures and fostering a healthier balance between inventory and demand. With strong economic drivers, including a growing workforce and sustained population growth, Columbus is well-positioned for long-term stability and resilience. These factors are expected to support continued demand for rental housing, providing a solid foundation for occupancy growth and steady rent appreciation in the coming years.
