Hampton Roads, VA

Market Update

Hampton Roads has experienced a modest population increase of 0.84% year-over-year, bringing the total to approximately 1.8 million residents. This follows a slight decline in 2023, suggesting a stabilization in demographic trends. The region benefits from a net migration of about 66,169 individuals, contributing positively to housing demand. With a median household income of $82,402 and an unemployment rate of 3.8%, the economic backdrop appears supportive of housing growth. The renter share stands at 37.1%, indicating a significant portion of the population is seeking rental housing, further driving demand in the multifamily sector.

In terms of multifamily fundamentals, the region's median gross rent remains stable at $1,556, with year-over-year rent growth recorded at 5.2%. This growth rate exceeds the national median of 3.5%, reflecting a stronger rental market in Hampton Roads. The current asking rents for two-bedroom units are approximately $1,696, which is slightly below the national benchmark of $1,771. The overall rent trajectory suggests a healthy demand, although affordability may be a concern for some renters given the rising costs relative to income levels.

Capital markets in Hampton Roads show a multifamily cap rate of 7.04%, aligning with the national median. Over the trailing 24 months, the market has seen 297 transactions with a total volume of approximately $817 million and a median price per unit of $295,000, which is about 48% higher than the national median of $200,000. This indicates a robust investment environment, with cap rates remaining stable. The outlook remains cautiously optimistic, as the region's fundamentals support continued interest from investors. CBRE Research notes that the multifamily sector is expected to maintain momentum, driven by ongoing demand and demographic trends.