Concession Rates Reach New High in Q2 2025

The latest data for Q2 2025 reveals a continued upward trend in rental concessions across the U.S., underscoring the competitive environment property managers are navigating.

National Trends: Concession rates climbed to 30% nationwide in Q2 2025, up from 23% this time last year. That’s a 7-point jump, signaling growing pressure on property owners to offer incentives like free rent or reduced deposits to fill vacancies.

Market Highlights:

• Phoenix, AZ continues to top the charts with the highest concession rate at 60%, up from 56% in Q1. That means a staggering 6 in 10 listings now include some kind of incentive.
• Colorado Springs, CO also saw a spike, reaching 55%, a 5-point increase from the previous quarter. This market has consistently been above the national median for more than a year.
• Charlotte, NC jumped from 34% to 46%, indicating a sharp increase in competition among landlords.
• Raleigh, NC holds steady at 54%, slightly down from its Q4 2024 peak of 59%, but still among the highest nationwide.
• Dallas-Fort Worth, TX also saw an increase, with concessions rising to 47% in Q2.

Markets Showing Improvement: Some metros bucked the national trend and saw modest declines or stabilization in concession activity:

• Baltimore, MD decreased to 17%, down from 20% in Q1.
• Philadelphia, PA fell to 15%, suggesting slightly improving conditions for landlords.
• Chicago, IL and San Diego, CA both saw flat or falling concession rates compared to earlier quarters.

What It Means for Property Managers: If you’re offering concessions, you’re not alone. Knowing how your local market stacks up is essential to staying competitive. In high-concession markets, leaning into creative incentives may help you stand out. But in areas where concessions are falling, now might be the time to scale back offers and focus on raising occupancy through marketing and operational efficiency.

Takeaway: The rise in concessions is a clear signal of shifting market dynamics. Whether you're operating in a cooling or heating submarket, staying data-informed will help you optimize your leasing strategy and stay ahead of the competition.