MARKET SNAPSHOT
$886 3Q 2024
93.4% 3Q 2024
198 [YTD: 702]
2.2% 3Q 2024
+30 BASIS POINTS
108 [YTD: 484]
Through the first three quarters of 2024, Wichita-area renters absorbed 702 units on a net basis, significantly outpacing the 484 units delivered during the same period.
The mid-tier apartment segment in Wichita is experiencing strong rental growth, outpacing the market average, driven by sustained job creation in service-based sectors such as education and health services.
Significant upcoming developments, including the Biomedical Campus in downtown Wichita and the Chapman Entertainment District in Park City, are poised to drive further economic growth and job creation in the Wichita metro area.
Through the first three quarters of 2024, Wichita-area renters absorbed 702 units on a net basis, significantly outpacing the 484 units delivered during the same period. With one quarter remaining, total net absorption for the year is on track to potentially rival the five-year peak of 1,000 units recorded in 2019. This surge in rental demand has been particularly pronounced in the newer suburban areas, with the Northwest, East Wichita, and West Wichita submarkets collectively accounting for nearly 90% of all metro-wide absorption over the past 12 months.
Wichita’s pace of deliveries is tapering off after a significant growth surge in 2023. As of the end of September, approximately 860 units were under construction, representing 2.4% of the current inventory, compared to the national average of 4.0%. The pipeline is now about 33% below its peak in early 2023. Development in Wichita has been primarily focused on high-end properties, with around 1,300 units added to this segment over the past three years, expanding the stock of luxury units by approximately 25%.
In the third quarter of 2024, Wichita recorded steady absorption, with 356 units absorbed. Over the past nine months, more than 700 units were absorbed, surpassing new deliveries by roughly 200 units. As a result, the average occupancy rate increased by 30 basis points over the past year, indicating that Wichita’s multifamily market is on a stable growth path. However, newer assets, facing direct competition from a wave of recent developments, continue to see occupancy rates just below 90%. In contrast, mid-range assets, less impacted by supply-side pressures, maintained a steady occupancy rate of 93.5%. As the large share of properties in lease-up phases declines, occupancy rates are expected to gradually rise heading into 2025.
Wichita has experienced steady rental growth, with the overall effective rental rate rising by 2.3% annually in the third quarter of 2024. This increase has been largely driven by the mid-tier apartment segment, which typically includes multifamily communities built between 1980 and 2004, where annual rent growth reached 3.4% by the end of September 2024. In contrast, higher-end properties—built within the last 20 years—are facing softer market conditions due to the influx of new units last year, intensifying competition. As a result, average rents in this segment saw a slight decline of 0.3%. With approximately 1,000 units still in the lease-up phase, rent growth in this segment is expected to remain subdued for the next few quarters.
Northwest and Sedgwick County are the highest-priced submarkets, with average rents exceeding $1,100 per month. The Northwest submarket, in particular, has doubled in size over the past five years, driven by development west of I-235. Of the 1,700 units in this submarket, 76% were built in the last seven years. Given its heavy concentration of newer, high-end properties, it was one of only three submarkets to record an annual decline in average rents. In contrast, the Southeast Wichita submarket, primarily consisting of mid- to lower-tier assets, recorded the highest rent growth at 3.8% in Q3 2024, highlighting the impact of new supply on the higher-end market.
In August 2024, the job market in the Wichita, KS Metro area exhibited steady growth, as reported by the Bureau of Labor Statistics (BLS). The addition of 5,200 new positions reflected a 1.7% employment growth rate. Several sectors saw notable gains, with the Education and Health Services sector leading by adding 1,900 jobs, a 4.0% annual increase. The Trade, Transportation, and Utilities sector followed closely, adding 1,500 jobs, a 2.8% expansion. Wichita’s unemployment rate was just below the national average, measuring 4.1% in August.
August 2024 ANNUAL JOBS CREATED
AUGUST 2024 EMPLOYMENT GROWTH
AUGUST 2024 Unemployment rate
4.2% us August rate
Nominal Change
from August 2023
to August 2024: 1,900
Percent Change: 4.0%
Nominal Change
from August 2023
to August 2024: 1,500
Percent Change: 2.8%
Nominal Change
from August 2023
to August 2024: 1,400
Percent Change: 2.7%
Nominal Change
from August 2023
to August 2024: 800
Percent Change: 4.4%
Nominal Change
from August 2023
to August 2024: 300
Percent Change: 2.3%
| Sector | Nominal Change from August 2023 to August 2024 | Percent Change |
|---|---|---|
| Education and Health Services | 1,900 | 4.0% |
| Trade, Transportation, and Utilities | 1,500 | 2.8% |
| Manufacturing | 1,400 | 2.7% |
| Mining, Logging, and Construction | 800 | 4.4% |
| Financial Activities | 300 | 2.3% |
| Other Services | 300 | 2.3% |
| Government | 0 | 0.0% |
| Information | -100 | -2.8% |
| Professional and Business Services | -400 | -1.1% |
| Leisure and Hospitality | -500 | -1.5% |
In June 2024, Lange Real Estate broke ground on the $500 million Champtown Development in Park City, KS. This 160-acre project is expected to drive tourism and spur economic development in the area.
Wichita Biomedical Campus, a partnership between the University of Kansas and Wichita State University, moves from plans to reality.
Park Centre will be a dynamic mixed-use development on 58 acres in the Wichita Metro Area, located in the heart of Park City.
Wichita’s apartment market has fared well compared to larger neighboring metros, which saw higher volumes of apartment development. A combination of a tapering development pipeline and stabilizing occupancy rates has created a favorable environment for property owners and operators. This trend is expected to continue, with rent growth projected to exceed 4.0% by mid-2025.
Wichita’s broader economic landscape also supports this positive outlook. The city’s strategic position as a hub for aerospace manufacturing and maintenance, coupled with significant recent and planned investments—such as the Biomedical Campus in downtown Wichita and the Chapman Entertainment District in Park City—will drive further economic growth and job creation. These developments are set to boost the local economy and, in turn, fuel housing demand in the near future.
Sources: Costar; ESRI; U.S. Census Bureau; Yardi Matrix; U.S. Bureau of Labor Statistics
