The figures contained herein focus on metro area multifamily buildings and/or complexes with a minimum of six units. Small-scale multifamily properties consisting of duplexes, townhomes or condos do not accurately affect local capitalization rates (cap rates), vacancy or rental rates and are therefore excluded from this analysis.

Similar to last year, higher interest rates and shifting purchasing power encouraged many prospective homebuyers to explore the flexibility and convenience of leasing, contributing to a strong rental market.

Approximately 580 units were added to the Cedar Rapids metro during 2024 with over 1,000 units planned for next year. The average vacancy rate for existing multifamily properties ranged from 5% (newer construction) to 10% (older buildings).

The average capitalization rate (CAP rate) increased only slightly to 7.51% in 2024, compared to 7.34% in 2023 and 7.28% in 2022. The 11 multifamily buildings sold throughout the year were constructed between 1963 and 1978 and included 854 units.

The multifamily sector has experienced a significant construction boom in recent years, reflecting strong demand. While the pace of new projects is beginning to moderate, the ongoing need for quality rental housing remains robust, driven by a growing population and the preferences of households seeking flexible living options and amenity-rich properties. Affordable housing continues to be a focus throughout the metro area.