Despite robust demand witnessed in the third quarter of 2023, Atlanta experienced a 3.6% year-over-year dip in annual rents. This was further accompanied by a slight quarterly decrease of 0.4%, a scenario primarily driven by the pace of unit completions nearly doubling the rate at which new leases were signed. This influx of supply momentarily outstripped demand, creating a softening in rental prices.
Upon delving into the performance across different product classes, it was evident that Class A units navigated through this scenario with a relatively lesser impact, recording an annual rent growth decline of 2.4%. In contrast, Classes B and C faced sharper annual reductions of 3.9% and 4.4%, respectively, indicating a more pronounced sensitivity to the supply-demand dynamics. Across Atlanta’s 39 submarkets, Doraville maintained its top position for rent growth for the second straight quarter, charting a notable 5.6% uptick. Remarkably, Doraville, along with South Atlanta, stood as the sole submarkets to register positive trajectories in rent growth during this period, although South Atlanta marked a marginal increase of 0.2%.