Lease renewal rates– the percentage of residents with expiring leases who choose to renew rather than move out – have been at 50 percent or higher since 2013, peaking at 53.5 percent in early 2015. Since then, however, resident retention has trended lower, below 52 percent, as apartment completion volumes have trended upward, reports RealPage.
Annual completions topped 300,000 units on an annual basis for the past two years. In turn, Class A units, which are most vulnerable to competition from new supply, have seen lower retention, which has impacted the overall retention rate.
As of mid-2018, resident retention is running at about 52.3 percent. Though down from the recent peak, it’s about 80 basis points above the cycle average.