Lease concession availability has changed this year more than with efficiency units . Roughly 13 % of one-bedroom units and 12 % of two-bedroom units were eligible for new lease discounts at the end of July – a small decrease from the beginning of the year for each . However , the average discount value rose for both groups of units . One-bedroom apartments averaged about 2.5 weeks off an annual lease to end the period while two-bedrooms averaged around two weeks off a 12-month lease . Discount availability declining while the average discount value increases typically suggests some challenges within the small share of properties offering a concession .
Three Bedroom Units
This group of units had the second-largest decline in rent growth from last year to this year behind efficiency units . Average effective rent for new leases rose by 6 % for three-bedroom units across Greater San Antonio so far this year . As with all but the efficiency units , this growth rate fell short of last year but was well beyond anything from the recent past . At the end of the period the average three-bedroom apartment was leasing for about $ 1,790 per month , or $ 1.34 per square foot .
There has not been much lease concession movement so far this year for three-bedroom apartments . Both availability and average value remained virtually unchanged at around 11 % of units offering a discount for new leases with an average concession value of two weeks off an annual lease .
Takeaways
It has been a challenging year so far in some respects for Greater San Antonio multifamily . On the one hand , average occupancy closed July still significantly higher than in 2018 , 2019 , or 2020 and average effective rent growth for new leases this year has already reached 7 % after last year ’ s 16 % gain . On the other hand , average occupancy fell 130 basis points over the last seven months and net absorption for the period was negative by almost 1,500 units . Much of the influence on rent growth has really been attributable to leftover occupancy accrued last year rather than by healthy and balanced market dynamics .
Even the top of the market is feeling the squeeze given that efficiency units underperformed the most compared to last year . The other floorplan types , even with less rent growth than last year , easily outperformed the years prior to 2021 . For efficiency units , 2019 saw stronger growth as well .
It is unclear how much further average occupancy will need to unwind before additional momentum is siphoned from rent growth . But it is clear that the headwind influencing affecting the industry have had a broader impact in Greater San Antonio than other major Texas markets in 2022 .