MARKET SNAPSHOT
The Little Rock metro area is experiencing a sharp decline in multifamily development, with new starts, units under construction, and completions all trending well below historical norms. In 2024, no new multifamily groundbreakings were identified by CoStar. Similarly, current construction activity remains significantly below past trends, with just 365 units underway at year-end 2024—67% below the historical average of 1,116 units. Looking ahead, completions are expected to fall sharply in 2025, dropping from 1,322 units in 2024 to just 354 units—a 73% decline compared to the 10-year annual average of 854 units.
Little Rock’s multifamily market experienced a slight decline in occupancy in 2024, with Q4 levels falling to 90.2%, down 50 basis points year-over-year. This softening trend is expected to continue into 2025, with projections indicating occupancy will average 90.0% by year-end, reflecting a further 30-basis-point decline. Occupancy rates will vary across submarkets, with Saline County (99.0%) and Grant County (97.9%) maintaining the highest levels due to limited inventory and steady demand. In contrast, North Little Rock—set to receive the metro’s only new supply in 2025 (365 units)—is projected to see occupancy fall further to 84.3%, one of the lowest levels in the region.
Little Rock’s apartment market saw moderate rent growth in 2024, with Q4 effective rents reaching $1,005—up 1.4% year-over-year. However, the pace of increases slowed throughout the year as rent growth decelerated from earlier quarters. Looking ahead, rents are expected to see modest gains in early 2025 before accelerating in the second half of the year. By Q4 2025, effective rents are projected to reach $1,024, representing an annual growth rate of 1.9%. Little Rock remains an affordable option relative to other regional markets, maintaining competitiveness in a slowing rental landscape.
12-month period ending November 2024
Little Rock continues to demonstrate economic resilience, driven by a diversified base and increasing investment in advanced manufacturing and aerospace. Job growth is expected to expand by 0.8% in 2025, adding 3,100 new positions across key sectors, reflecting a stable labor market with sustained opportunities. Major corporate investments are further strengthening the city’s economic landscape, particularly in manufacturing and aerospace. Notably, a $100 million pipe manufacturing facility expansion at the Little Rock Port will add 175 jobs, while Dassault Falcon Jet’s $100 million investment in its local facility is set to create 800 new high-skilled aerospace positions. These developments are expected to drive long-term job creation and fuel demand for multifamily housing as the workforce grows.
With this momentum, Little Rock remains an attractive destination for real estate investment, particularly in the multifamily sector. The city’s strategic expansion in manufacturing, aerospace, and business services is reinforcing rental demand, while its competitive cost of living continues to attract both employers and residents. Looking ahead, sustained corporate investment, job growth, and infrastructure development will solidify Little Rock’s position as a key economic hub in the South, ensuring long-term stability and strong investment potential in the multifamily market.
