MARKET SNAPSHOT
Wichita’s multifamily construction pipeline currently totals approximately 890 units, accounting for 2.3% of existing inventory—well below the national average of 3.3%. Following a period of limited construction from 2019 to 2021, development gained momentum in 2022, with nearly 1,000 units breaking ground—the highest level since 2017—resulting in the completion of approximately 1,700 units over the past two years. Looking ahead, development activity is expected to remain slightly elevated, with new completions projected to reach 815 units in 2025, about 30% higher than the 10-year historical average.
Over the past year, net absorption reached 872 units, the highest level since 2019 and a significant increase from 190 units the previous year. This surge in demand offset the 644 units delivered over the same period, contributing to a 10-basis-point increase in the stabilized occupancy rate. However, with new completions expected to rise in 2025 and net absorption projected to return closer to the long-term historical average, stabilized occupancy is anticipated to decline by 30 basis points by year-end.
Beyond 2025, the construction pipeline remains sparse. If construction starts remain muted this year, supply pressure should ease, supporting an upward trend in occupancy by 2026.
With average effective rent measuring just under $900 per month, Wichita’s rental rates are approximately half the National Index. Like much of the country, the market saw a sharp rise in asking rents following the post-pandemic surge in demand, with annual rent growth peaking at 7.5% in early 2022. However, Wichita has maintained a healthier pace of rent growth compared to the national benchmark, posting a 1.8% increase over the past year—outpacing the National Index of roughly 1.0%.
The Class A segment has shown some softness amid heightened competition, with rents declining by more than 1.5% to an average effective rate of $1,184 as of Q4 2024. In contrast, mid- and lower-tier properties have remained resilient, recording rent growth exceeding 2.5% over the same period. Looking ahead, CoStar’s base-case forecast anticipates an acceleration in rent growth as the construction pipeline clears by the end of 2025. Overall, effective rents are projected to increase by 2.5% by Q4 2025.
12-month period ending November 2024
Wichita’s multifamily market continues to experience measured growth in both inventory and rent performance. New unit completions are expected to rise to 815 units in 2025, adding near-term supply pressure. However, rent growth remains healthy, with effective rents increasing 1.8% over the past year—outpacing the national average of 1.0%. Class A properties have faced some softness, with rents declining by more than 1.5% to an average of $1,184, while mid- and lower-tier properties have shown resilience, recording rent growth above 2.5%.
Looking ahead, CoStar’s base-case forecast anticipates a further acceleration in rent growth as supply pressures ease by the end of the year, with effective rents projected to rise 2.5% by Q4 2025. While an increase in completions is expected to weigh on occupancy levels this year, the construction pipeline beyond 2025 remains sparse. If new starts remain limited, occupancy rates could trend upward in 2026 as demand gradually absorbs available inventory.
