Phoenix Multifamily Market Report

The following reflects Phoenix multifamily market conditions as of Q2 2026.

The Phoenix multifamily market in Q2 2026 showed improving fundamentals as vacancy rates declined and renter demand strengthened. Net absorption significantly outpaced new deliveries, helping absorb recent supply additions, while developers continued to reduce construction activity. Explore our full Phoenix multifamily market report for detailed insights on vacancy trends, rental rates, development activity, and investment performance.

Frequently Asked Questions

What is the vacancy rate for the Phoenix multifamily market in Q2 2026?

The Phoenix multifamily vacancy rate was 11.3% in Q2 2026, according to Kidder Mathews research. This is down 40 basis points from 11.7% one year earlier in Q2 2025 and also down from 11.7% in Q1 2026. The decline reflects renter demand absorbing new supply as construction activity slows (Data source: CoStar).

What are average asking rents by unit type in the Phoenix multifamily market in Q2 2026?

Average monthly asking rent across the Phoenix multifamily market was $1,536 per unit in Q2 2026, down 2.17% year-over-year. By unit size, average asking rent was $1,145 for studios, $1,373 for one-bedroom units, $1,632 for two-bedroom units, and $2,107 for three-bedroom units, according to Kidder Mathews research.

How much net absorption did the Phoenix multifamily market see in Q2 2026?

Net absorption totaled 4,168 units in Q2 2026 alone and 9,414 units year-to-date, a 50.24% increase over the 6,266 units absorbed in the same period of 2025. Net absorption measures the change in occupied units over a given period, and this increase signals renter demand outpacing the prior year’s pace (Data source: CoStar).

What is the construction pipeline for the Phoenix multifamily market in Q2 2026?

Units under construction fell 35.45% year-over-year to 15,974 as of Q2 2026, down from 24,746 units a year earlier and from 17,485 units in Q1 2026. Notable projects underway include Pier 202 in Downtown Tempe (586 units, expected 4Q26) and Inspire Sonoran Desert in North Gateway (560 units, expected 1Q27), according to Kidder Mathews research.

How do Phoenix multifamily construction deliveries compare year-over-year?

Construction deliveries totaled 3,221 units in Q2 2026 and 6,355 units year-to-date, down 5.42% from 6,719 units delivered over the same period in 2025. Recently completed properties include Shorehaven in Downtown Tempe (722 units, delivered April 2026) and Ray Phoenix in Roosevelt Row (401 units, delivered April 2026), according to Kidder Mathews research.

What was the largest multifamily sale transaction in Phoenix in Q2 2026?

The largest multifamily sale in Q2 2026 was The Residences Kierland in North Scottsdale, a 290-unit property that sold for $142,500,000, or $491,379 per unit. MacNaughton purchased the property from Quarterra. Another significant transaction was Longbow Luxury Apts in Central Mesa, a 339-unit property that sold for $95,250,000, or $280,973 per unit (Data source: CoStar).

What are cap rates for Phoenix multifamily properties in Q2 2026?

The average cap rate for Phoenix multifamily properties was 5.8% in Q2 2026, down 80 basis points from 6.6% one year earlier. Average sale price per unit rose 3.64% year-over-year to $266,672, indicating improving investor sentiment even as cap rates compressed, according to Kidder Mathews research.

What is the outlook for the Phoenix multifamily market heading into the second half of 2026?

The Phoenix multifamily market outlook is positive, with vacancy declining and net absorption up 50.24% year-over-year while new construction starts continue to slow. This combination suggests the market is working through its recent supply wave, with rents holding relatively stable and investment metrics strengthening as cap rates compress and sale prices per unit rise (Data source: CoStar).

Last updated: Q2 2026. Data source: CoStar. Compiled by the Kidder Mathews Research Group.

2Q 2026 Phoenix Multifamily Market: Key Data Points

Explore our full Phoenix multifamily market review for deeper insights into vacancy trends, rental rates, and investment performance.

• Vacancy Rate Continues to Improve: Phoenix multifamily vacancy declined to 11.3% in Q2 2026, down 40 basis points from one year ago as demand continues to absorb new inventory.
• Net Absorption Surges Year-Over-Year: Net absorption totaled 9,414 units year-to-date, a 50.2% increase from the same period last year, signaling stronger renter demand across the market.
• Construction Pipeline Shrinks: Units under construction fell 35.5% year-over-year to 15,974 units, reflecting a significant slowdown in new multifamily development.
• Deliveries Decline as Development Moderates: Multifamily deliveries totaled 6,355 units year-to-date, down 5.4% from the prior year as the market works through its recent supply wave.
• Average Rents Remain Relatively Stable: Average asking rents measured $1,536 per month, down 2.2% year-over-year as operators balance occupancy gains with rent growth.
• Investment Metrics Strengthen: The average sale price reached $266,672 per unit, up 3.6% year-over-year, while average cap rates compressed to 5.8%, indicating improving investor sentiment.

Average Rent by Unit Type

Significant Sale Transactions Q2 2026

Significant Under Construction

Significant Completed Construction Q2 2026

Data as of Q2 2026. Source: CoStar. Prepared by the Kidder Mathews Research Group.