Richmond, VA Multifamily Market Report: July 2026 Complete Analysis

# Executive Summary: Richmond Multifamily Market — Q2 2026

The Richmond, Virginia multifamily market enters the second half of 2026 in a similar position to where it stood in March: absorbing an elevated but declining construction pipeline while demand continues to outperform history. Vacancy sits at **8.3%**, total inventory has grown to **109,117 units**, and **4,667 units** remain under construction. Rent growth has slowed to **0.9% annually** as the market digests recent deliveries — but the supply story is turning, and the data increasingly supports the same thesis: *this is a temporary overhang, not a structural demand problem.*

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## Key Performance Indicators (Q2 2026)

| KPI | Data Point (Q2 2026) |

| :--- | :--- |

| **Total Apartment Inventory** | 109,117 units |

| **Market Vacancy Rate** | 8.3% *(vs. 8.1% national average)* |

| **12-Month Net Absorption** | 2,684 units *(83% above 10-year annual average of 1,464)* |

| **Average Asking Rent** | $1,609 per month |

| **12-Month Rent Growth** | +0.9% *(vs. +0.7% nationally)* |

| **Under Construction Pipeline** | 4,667 units across 19 properties (4.3% of inventory) |

| **12-Month Delivered Units** | 2,379 units |

| **12-Month Sales Volume** | $835.3 million |

| **Market Cap Rate** | 6.3% – 6.4% |

> **Data source:** CoStar Group, licensed to Marcus & Millichap, July 26, 2026.

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## Economic Overview: Demographics and Employment

Richmond's metropolitan statistical area totals roughly 1.39 million residents across the City of Richmond, Henrico, Chesterfield, Hanover, and surrounding counties. The market's median household income of **$86,559** now exceeds the national figure of $84,955, and unemployment sits at just **3.6%** versus 4.5% nationally — a gap that continues to support renter demand and rent-paying capacity.

### Key Demographic Statistics (Q2 2026)

| Demographic Category | Richmond Metro | U.S. National Average |

| :--- | :--- | :--- |

| **Total Population** | 1,388,472 | 342,433,219 |

| **Households** | 565,342 | 134,479,438 |

| **Median Household Income** | $86,559 | $84,955 |

| **Labor Force** | 723,317 | 170,451,438 |

| **Unemployment Rate** | 3.6% | 4.5% |

*Source: Oxford Economics via CoStar.*

### Employment Market Drivers

Richmond's total employment stands at approximately 726,000 workers across a genuinely diversified base. Finance plays an outsized role locally, anchored by Capital One and Truist, and Richmond remains one of the few U.S. markets hosting both a Federal Reserve Bank and a U.S. Court of Appeals — institutional anchors that provide employment stability through economic cycles.

#### Employment by Major Sector (Q2 2026)

| Industry Sector | Jobs (Thousands) | Location Quotient | 12-Month Growth |

| :--- | :--- | :--- | :--- |

| **Trade, Transportation & Utilities** | 132 | 1.0 | -0.82% |

| **Professional & Business Services** | 124 | 1.2 | +0.10% |

| **Education & Health Services** | 116 | 0.9 | +1.85% |

| **Government** | 112 | 1.1 | -1.25% |

| **Leisure & Hospitality** | 68 | 0.9 | -2.64% |

| **Financial Activities** | 59 | 1.4 | -0.37% |

| **Natural Resources, Mining & Construction** | 43 | 1.1 | -1.22% |

*Source: Oxford Economics via CoStar.*

#### Major Employer & Quality-of-Life Advantages:

* **Jabil Expansion:** Announced a new manufacturing facility at Crosspointe Logistics Center in Prince George's County in 2026, expected to employ over 350 people.

* **CoStar Group Growth:** Announced 1,000 new Downtown Richmond positions in 2025, following its 2021 announcement of 2,000 new jobs.

* **Logistics Hub:** Located on Virginia's fall line at the intersection of I-85, I-95, I-295, and I-64, supported by Richmond Marine Terminal upgrades.

* **Higher Education:** VCU and UVA provide a steady pipeline of young professionals into the local renter pool.

* **Top Business Climate:** CNBC named Virginia the **#4 state for business** in its 2025 Top States for Business list.

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## Apartment Vacancy Analysis: Current Levels, Trends, and Forecast

Richmond's vacancy rate of **8.3%** sits above the market's 10-year historical average of 7.0% but is essentially in line with the current national average of 8.1%. Vacancy has been mostly stable over the past year, and the market has posted positive net absorption for **13 consecutive quarters**, with demand exceeding 600 units per quarter for nine straight quarters.

### Vacancy by Property Class (Q2 2026)

| Property Class | Vacancy Rate | Total Units | Avg Asking Rent |

| :--- | :--- | :--- | :--- |

| **4 & 5 Star** | 9.6% | 41,037 | $1,831 / mo |

| **3 Star** | 7.8% | 38,905 | $1,572 / mo |

| **1 & 2 Star** | 7.3% | 29,175 | $1,312 / mo |

| **Market Total** | **8.3%** | **109,117** | **$1,609 / mo** |

> *As in March, elevated vacancy is concentrated almost entirely in newly-delivered 4 & 5 Star lease-up product, while stabilized 1 & 2 Star assets are running tighter than the market average. About **80% of Richmond's net absorption** over the past year has gone into 4 & 5 Star properties.*

### Submarket Performance Overview

* **Highest Vacancy Submarkets:** West End (15.4%), Downtown Richmond (10.0%), South Richmond (9.5%), Northside (9.1%), Petersburg/C Hghts/Ft Lee (8.4%).

* **Lowest Vacancy Submarkets:** Dinwiddie County (0.6%), Sussex County (1.3%), Goochland County (3.3%), Hanover County (4.8%).

#### Key Submarket Drivers:

* **Western Henrico County:** Richmond's largest submarket (28,282 units / 25.9% of total). At 8.2% vacancy, it absorbed 628 units over the past year with 1,209 units under construction. Average rent: $1,677/mo.

* **Downtown Richmond:** Accounts for 16,172 units (14.8% of inventory) and posted the highest absorption at 644 units despite carrying 10.0% vacancy. Leads construction with 1,858 units underway.

* **Midlothian:** Affluent southern suburb holding 8,085 units with 8.0% vacancy and $1,853/month average asking rent — Richmond's second-highest-priced submarket.

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## Rent Analysis: Pricing, Growth Trends, and National Comparison

### Richmond Rents vs. National Averages

| Metric | Richmond Average | National Average | Discount |

| :--- | :--- | :--- | :--- |

| **Average Asking Rent (All)** | $1,609 / mo | $1,800 / mo | -10.6% |

| **4 & 5 Star Asking Rent** | $1,831 / mo | $2,240 / mo | **-18.3%** |

### Top Submarket Rents (Q2 2026)

| Submarket | Asking Rent / Unit | 12-Month Rent Growth |

| :--- | :--- | :--- |

| **West End** | $1,984 / mo | +4.5% |

| **Midlothian** | $1,853 / mo | +1.3% |

| **Goochland County** | $1,816 / mo | -5.9% |

| **Hanover County** | $1,743 / mo | +0.8% |

| **Downtown Richmond** | $1,722 / mo | -0.1% |

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## Construction Pipeline & Delivery Forecast

Richmond currently has **19 properties totaling 4,667 units under construction**, representing 4.3% of existing inventory (above the 2.7% national average).

### Top Development Projects Currently Under Construction

| # | Property Name | Units | Stories | Est. Completion | Developer |

| :--- | :--- | :--- | :--- | :--- | :--- |

| **1** | Harp's Landing Apartments | 398 | 4 | Nov 2027 | Gumenick Properties |

| **2** | The Russell | 388 | 5 | Dec 2026 | Greystar Real Estate Partners |

| **3** | 3200 W Moore St | 366 | 6 | Sep 2027 | Hoffman & Associates |

| **4** | 3 Notch'd Flats | 325 | 4 | Sep 2026 | Edward Rose & Sons |

| **5** | Regent at Regency | 314 | 5 | Sep 2026 | Thalhimer Realty Partners |

| **6** | MAA Rove | 306 | 5 | Oct 2026 | Mid-America Apartment Communities |

| **7** | Altitude on Main | 302 | 16 | Aug 2026 | RPC Realty Capital |

| **8** | Midlothian West | 275 | 3 | Jul 2027 | BWS Enterprises |

| **9** | Alexan Manchester | 260 | 5 | Sep 2027 | Trammell Crow Residential |

| **10**| 200 E Marshall St | 254 | 12 | Jan 2027 | SNP Properties |

### Delivery & Absorption Forecast

| Year | Deliveries | Net Absorption | Construction Ratio | Year-End Vacancy |

| :--- | :--- | :--- | :--- | :--- |

| **2026 YTD** | 1,035 | 1,587 | 0.7x | 8.3% |

| **2026 (Full Year)** | 3,031 | 3,080 | 1.0x | 8.6% |

| **2027** | 2,034 | 2,455 | **0.8x** | **8.1%** |

| **2028** | 2,147 | 1,886 | 1.1x | 8.2% |

| **2029** | 1,752 | 1,571 | 1.1x | 8.2% |

| **2030** | 1,855 | 1,721 | 1.1x | 8.2% |

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## Investment Activity & Sales Analysis

Trailing 12-month sales activity reached **$835.3 million** across 46 transactions — well above the market's 10-year annual average of $382.2 million.

### Recent Significant Sales Transactions

| Property | Units | Yr Built | Sale Date | Price | Price / Unit |

| :--- | :--- | :--- | :--- | :--- | :--- |

| **Marshall Springs at Gayton West** | 420 | 2014 | Dec 2025 | $119,750,000 | $285,119 |

| **2000 West Creek Apartments** | 373 | 2018 | Jun 2026 | $115,000,000 | $308,310 |

| **Innsbrook Square** | 305 | 2023 | Feb 2026 | $81,700,000 | $267,868 |

| **Colony at Centerpointe** | 255 | 2016 | Jun 2026 | $74,600,000 | $292,549 |

| **Triton Glen** | 250 | 2023 | Dec 2025 | $65,000,000 | $260,000 |

| **The Boulders Lakeview** | 212 | 2023 | Jan 2026 | $51,500,000 | $242,924 |

| **Innslake Place** | 221 | 2020 | Feb 2026 | $51,250,000 | $231,900 |

### Cap Rate Projections by Asset Class

| Property Class | 2026 YTD | 2026 (Full Year) | 2027 | 2028–2030 |

| :--- | :--- | :--- | :--- | :--- |

| **4 & 5 Star** | 6.2% | 6.2% | 6.1% | 6.0–6.1% |

| **3 Star** | 6.4% | 6.3% | 6.3% | 6.2% |

| **1 & 2 Star** | 6.6% | 6.5% | 6.5% | 6.4% |

| **Overall Market** | **6.4%** | **6.3%** | **6.2%** | **6.2%** |

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## Investment Outlook & Conclusion

### Strengths

* High median household income ($86,559) and tight regional unemployment (3.6%).

* Long-term rent growth convergence upside due to the deep discount (-10.6% overall, -18.3% Class A) versus national averages.

* Strong demand trajectory with 13 consecutive quarters of positive net absorption.

### Risk Mitigation Strategies

1. **Submarket Selection:** Focus on Western Henrico County and Midlothian for durable structural demand.

2. **Conservative Lease-Up Assumptions:** Underwrite current vacancy rates through mid-2027.

3. **Class Targeting:** Target stabilized 1–3 Star assets facing minimal new luxury construction competition.

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### Author & Report Metadata

This market analysis was prepared by **Justin Ferguson**, First Vice President of Investments at **Marcus & Millichap**, utilizing data from CoStar Group *(licensed July 26, 2026)* and Oxford Economics.

* **Market Coverage:** City of Richmond, Henrico County, Chesterfield County, Hanover County, Goochland County, Midlothian, Downtown Richmond, Western Henrico, South Richmond, Petersburg, and surrounding Richmond MSA submarkets.

* **Report Date:** July 26, 2026 | **Next Update:** October 2026

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