Renters are increasingly choosing to stay put rather than venture into the unknown, where elevated home prices and broader economic volatility await.

Apartments are staying full longer as high mortgage rates and limited inventory keep renters in place.

Historically, about half of apartment renters choose not to renew their leases. In the first quarter of 2025, that number has dropped to between 30% and 35% in the portfolios of major multifamily landlords, according to Piper Sandler Managing Director of Research Alex Goldfarb.

Large multifamily REITs have reported some of the lowest turnover rates in their companies’ history in recent calls with analysts, like Equity Residential, which reported a 7.9% turnover rate in the first quarter. 

“We’ve seen price growth still put a lot of burden financially on families and individuals across the country,” National Apartment Association Vice President of Research George Ratiu said. “With volatility and uncertainty, I think a lot of folks renting might choose to take what I would say is the certainty of rent over making a long-term commitment.”

Major REITs like Camden Property Trust reported a 31% annualized net turnover rate in Q1, one of the lowest in its history. Essex Property Trust said its turnover landed at 35%, below the company’s long-term average.

Marcie Williams, chief strategy officer of The Bainbridge Cos., which develops, acquires and manages multifamily properties nationwide, is seeing roughly two-thirds of tenants stay put at many of its communities.

“That [retention rate] is extremely high,” Williams said. “I’ve been in this business over 30 years, and that is definitely not typical overall.”

Since President Donald Trump’s “Liberation Day” tariff announcement at the beginning April, price expectations and trade policies have seesawed, prompting fears of a trade war and heightening economic uncertainty. 

Consumer confidence plunged to a 13-year low in April, prompting many commercial real estate professionals to prepare for a recession. But that hasn’t impacted apartment owners, and some see them as a clear winner in an environment with costs spiking. 

“There are a few stories of residents expressing concern due to job loss, but nothing at the moment that is impacting any of our stats, results or projections for the next 90 days in the market,” Equity Residential Chief Operating Officer Michael Manelis said on his company’s first-quarter earnings call. 

Manelis said even in D.C. and Northern Virginia, where federal government job losses are having an outsized economic impact, Equity’s complexes are more than 97% occupied.

But multifamily turnover has been shrinking for the past two years, driven by rising home prices, high interest rates and a shift in renter preferences toward more livable and amenity-rich spaces — a change that began during the pandemic, Goldfarb said.

Less than a third of renters are looking to buy a home within the next five years, according to a survey conducted by Gallup. The cost of homeownership, including the down payment, was cited as the biggest barrier for renters trying to break into the housing market.

“It’s really just the uncertainty with the economy and still the high barriers to entry, with higher interest rates and higher down payments, that has allowed our residents to be able to enjoy the service that we provide and the apartment home that they currently live in,” Williams said.

For landlords, that stability is a win. Lower turnover reduces operating and maintenance costs — typically ranging from $750 to $1,800 per unit — as well as marketing expenses and vacancy loss, since each unoccupied day results in lost revenue, she said.

“There really is nothing negative that comes from having lower turnover,” Williams said.

The bulk of move-outs and lease expirations occur in the spring and summer, Ratiu said, so lower turnover rates at the beginning or end of the year are more common. But turnover is expected to stay low during peak move-out season, even with new units continuing to come to the market, Goldfarb said.

After eight consecutive quarters of record apartment deliveries, completions have fallen from 153,000 units at the end of 2024 to 116,100 units in the first quarter, according to RealPage.

“This year is the second and final year of this outsized supply wave that we’ve seen, primarily in the Sun Belt,” Goldfarb said. “But last year, we had a big supply [increase], and yet turnover declined. So I don’t see any reason why turnover should increase as the second wave of supply delivers.”

With fewer move-outs, owners of the new apartments that have come online are fighting to get in on the action and competing more aggressively for tenants.

That is driving up concessions on new leases, sometimes as high as two months of free rent and $1K gift cards, especially in Sun Belt cities like Jacksonville and Charlotte, Williams said.

“When those properties are 0% occupied, competing with an apartment community that’s 95% occupied, they have to have those concessions to keep up the velocity and the velocity you know you want to make,” Williams said.

But deliveries are expected to fall 14% in 2025, according to Multi-Housing News, tipping the balance of power back toward landlords. With fewer new options coming online and renters growing hesitant to move out, prices are expected to start rising.

“The landlord goes, OK, how much do we think we can raise rent before we raise too much that the person just says, ‘The heck with it, I’m out?’” Goldfarb said. “And I think most people would agree that the mental cost of moving exceeds the actual dollar amount.”

The Moinian Group secured a 27,500-square-foot, five-year lease renewal with Gardiner & Theobald, an independent construction and property consultancy for the built environment, at 535 & 545 Fifth Ave. in Manhattan’s Midtown East. Gardiner & Theobald will continue utilizing its space to carry out its office operations.

Omar Sozkesen, VP of commercial leasing at The Moinian Group, represented ownership in-house. The tenant was represented by Evan Fiddle, SVP at CBRE.

“The renewal of Gardiner & Theobald’s lease is a testament to the quality of spaces at our properties, and we are pleased the company has chosen to continue its operations at 535 & 545 Fifth Ave.,” said Sozkesen. “Located within one of New York City’s most prominent retail and office corridors, we’re proud of the continued leasing success we’ve had at the property.” 

In addition to the building’s office component, the property’s retail space recently reached 100% occupancy with the signing of Paris-based professional football club Paris Saint-Germain.

Life science REIT IQHQ said Tuesday it had entered into an early lease renewal and long-term extension with Generate:Biomedicines at the Innovation Park life science district in Andover, MA. Innovation Park houses Generate’s 75,000-square-foot cryogenic electron microscopy laboratory, one of the largest laboratories of its type in the U.S.

IQHQ acquired the Innovation Park campus between 2020 and 2021 and developed it into a 340,000-square-foot life science hub for leading biotechnology and life science manufacturing companies in the greater Boston market. “We are proud that Generate:Biomedicines, a global leader in generative biology, has made a long-term commitment at IQHQ’s Innovation Park district to accelerate breakthroughs in therapeutic discovery and development at their cutting-edge CryoEM laboratory,” said Tracy Murphy, co-CEO and co-founder of IQHQ.

Innovation Park is one of four life science districts IQHQ owns in Greater Boston. Leasing at the park is overseen by Colliers’ Curtis Cole and Tim Allen.

Williams Equities said it leased nearly 57,000 square feet in 2024 at 136 Madison Ave. In the most recent transaction at the Midtown South boutique property, the ownership group completed an 18,364-square-foot, full-floor renewal with technology firm Impact.com.

The latest transaction leaves Williams with just a single floor available. Earlier in 2024, Williams signed Peter Pennoyer Architects to a long-term renewal for 18,364 square feet and closed a long-term 20,000-square-foot extension with high-end furniture company Bernhardt Furniture for its flagship office and showroom.

French clothing and accessories company Lacoste also moved onto the top floor of the building this year, following an 18,364-square-foot lease it signed at the end of 2023.

“Companies continue to recognize the benefits of easily accessible and well-maintained boutique properties in Midtown South,” said Mac Roos of Colliers, who along with Andrew Roos, Michael T. Cohen and Jessica Verdi represented ownership in these transactions. “We value long-term relationships with our tenants, which is evident in the leasing we’ve accomplished at 136 Madison Ave.”

Alex Leopold of CBRE represented Impact.

Virco Manufacturing, a supplier of furniture and equipment for K-12 schools, has signed a multi-year renewal of its 559,000-square-foot space in the Prologis-owned 2027 Harpers Way in Torrance. It represents the first lease renewal for The Klabin Company/CORFAC International that involves the installation of solar panels for a client’s energy consumption. The panels are set to be installed next year.

The Klabin Company’s Frank Schulz III represented Prologis in the 65-month lease transaction. Virco was represented by David Prior and Todd Taugner of The Klabin Company. Virco will maintain its L.A.-area headquarters at the facility set on more than 23.5 acres near the intersection of Van Ness Avenue and Del Amo Boulevard in the heart of the South Bay industrial market.

“Due to Prologis’ incredible commitment to its customers, we were able to structure this lease for Virco to keep them in this location for years to come without any disruption to its operations,” said Prior.

The International Republican Institute (IRI) has renewed its lease for 47,416 square feet at 1225 I Street NW in Downtown Washington, DC. The lease renewal was brokered by Cushman & Wakefield (CWK), representing landlord Piedmont Office Realty Trust. The terms of the lease were not disclosed.  

Kyle McFadden, Eugene Kenney, and John Skolnik of C&W represented the landlord, while Randolph Harrell, Kevin Howard, and Lara Nealon of CBRE represented IRI. The renewal of IRI’s office space was one of the top 10 leases in the District in the first quarter of the year, according to a report from Savills. 

“We are thrilled to announce that IRI has chosen to extend its lease at 1225 Eye St. NW. This decision underscores Piedmont Office Realty Trust’s commitment to fostering strong partnerships across its portfolio. Retaining a tenant of IRI’s magnitude in an incredibly competitive marketplace speaks volumes about the trust and value Piedmont provides to its clients,” said McFadden,