Minnesota Market Overview
The Minnesota multifamily market has been experiencing steady growth over the last few years. However, lingering economic clouds and the surge of new apartments hitting the Minnesota market, specifically the Twin Cities bring a challenge and influx in the competitive landscape in the rental housing market.
From urban luxury apartments in bustling downtown Minneapolis studios and rentals in sprawling suburban areas, the multifamily market in Minnesota offers a diverse range of options catering to a wide array of demographic groups, and crucial for multifamily marketers to know about the latest industry trends for A, B, and C class properties to achieve optimal results for their marketing campaigns.
4 Trends to Know for the Minnesota Multifamily
Turning “OPE’s” into Opportunities for Rental Housing Marketers in the Twin Cities.
- Occupancy Trends for the Twin Cities: 60.5% of residents are choosing to renew their lease, so multifamily marketers and on-site teams have opportunities for a strategic retention strategy across marketing mediums.
- Changes in Minnesota Rent Prices: Compared to the national rent average of $1,697, the Twin Cities are below average with opportunities to attract residents and highlight points of interest and desirability.
- Vacancy Trends: The Twin Cities metro area apartment vacancy rate now stands at 4.1%, down from 4.8% compared to 2023.
- Disclosing Apartment Fees Law: As of January 1st, 2024, properties in Minnesota are required to disclose non-optional fees when advertising pricing and you betcha we have some options on how to navigate this new law.
Occupancy Trends for the Twin Cities
With the completion of more apartments in the Twin Cities metro area, this resulted in a lower occupancy rate than the national level in peak rental season during 2023. Renters have more options to choose from now, largely due to the lag effect of the pandemic building boom, which is becoming more and more present across Minnesota.
With more choices available, more and more renters have moved into new apartments. Consequently, only 60.5% of apartment dwellers opted to renew their leases at the height of peak rental season this year – lower than the same period last year when 63.6% of renters chose to stay put.
"About 75,000 more units were delivered than absorbed in the first quarter nationally, and so national average occupancy fell 0.5% to just under 89%. Despite the continued occupancy decline, this year’s opening quarter represented an improvement from last year’s 0.8% loss thanks to the higher net absorption to open 2024."
Changes in Minnesota Rent Prices
Asking rents continued to trend higher, rising 1.2% in the second quarter to $1,510 per month on average. Area rents increased 3% during the past 12 months, with the national rent average at $1,697.
Minnesota Vacancy Trends
The Twin Cities metro area apartment vacancy rate now stands at 4.1%, down from 4.8% in the second quarter of last year. Factoring in lease-ups, the adjusted vacancy rate is 5.2%.*
Minnesota’s New Advertising Law
Starting January 1st, 2024, properties in the state of Minnesota are required to disclose non-optional fees when advertising pricing. To help mitigate this risk, you betcha we have some options and steps to take on how to navigate this new law and mitigating risk.
Here is an example that directly correlates to this law in practice:
If an apartment advertises “2 Bedroom Apartments Starting At $2,000” there must also be language stating “Utilities not included” or “Utilities included in rent” within the ad.
We Recommend:
Currently, we obtain pricing and availability data directly from your Property Management System (PMS) to integrate into your digital advertising. It is strongly advised that you incorporate the disclosure of non-optional fees in the pricing information transmitted through your PMS to our advertisements. This straightforward measure would effectively mitigate any potential legal risks associated with the recent regulatory changes.
Questions? Reach out to us.
Your Minnesota Multifamily Marketing Strategy
From occupancy and vacancy trends to optimizing your marketing strategy and budgets, not to mention keeping up with the latest advertising laws can be a lot to juggle. We’re here to support you on your journey and turn “OPE’s” into opportunities with your properties in Minnesota. Here we break it down with digital marketing strategies and insights for:
Questions? We’re here to support you with your Minnesota marketing strategy. Connect with one of our experts!
