Before the COVID-19 pandemic, rental rates and occupancy levels in the Capital Region were slipping, as the market slowly absorbed properties built since 2017.
That changed in 2021 and 2022, when the Baton Rouge area joined the national trend of rising rents and falling vacancies. To be sure, local costs didn’t spike as much as some red-hot markets or even keep up with the average national increase, which at the end of this April was above 16% year over year.
But rental rates in a matched set of local apartments checked early this year had “rocketed upward” 10% compared to last year, according to data Cook, Moore, Davenport and Associates, LSU’s Real Estate Research Institute, the Greater Baton Rouge Association of Realtors and the Baton Rouge Apartment Association compiled for the annual Baton Rouge TRENDS real estate report. Rates were basically flat the year before.
Meanwhile, the vacancy rate declined from about 9.2% last spring to about 4.9% this spring, based on a survey of 252 apartment complexes. The historical average is around 6% to 7%.
As the Capital Region draws closer to a full recovery of its pre-pandemic jobs total, and as the supply of single-family homes remains tight, demand for apartments should stay healthy. But landlords and developers might not want to get too comfortable, because more competition is on the way.
Read the full story from the latest edition of Business Report.