After a tough year of flat rents in 2023, the multifamily market in San Jose has had consistent growth since the start of 2024. Rents continued to rise in February, marking a 0.8% increase from January, leading to an annual growth rate of nearly 10%.
Landlords are hopeful for the trend to continue throughout 2024 although it is still early in the year. Increased renter demand may help offset higher expenses in insurance and utilities which have affected landlords over the last year.
Recent apartment developments in Silicon Valley, such as The Tillery in Mountain View and the Hannover Winchester near Santana Row, have shown strong performance, indicating a robust demand for modern, premium living spaces. Multiple developments currently being constructed are expected to become part of these communities over the year, such as the Sofia at Lawrence Station in Santa Clara, which consists of 286 units.
The upcoming completion of nearly 2,400 new units in 2024, despite potentially increasing market competition, is expected to keep rental demand high due to elevated mortgage rates, possibly allowing landlords to further increase rents.
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Source: CoStar
