Huntsville, AL Multifamily Market Report 2025

Huntsville multifamily continues to solidify its reputation as an economic powerhouse, consistently outperforming national trends across key growth metrics. The metro’s trajectory is defined by a rapid demographic expansion as Huntsville ranks sixth in the nation for population growth, increasing by 58% since 2000. By year-end 2025, Huntsville’s population was estimated at 250,648 residents, a rise of 16.6% since the 2020 Census. Furthermore, the metro’s economic prosperity is underscored by an average household income of $108,150. With population and employment continuing to rise at a steady 3% annually, Huntsville remains a top-tier destination for new and expanding businesses seeking a high-performance workforce and a thriving innovation ecosystem.

Key Findings

While the vacancy rate hit a record peak of 20.0% in early 2024, it began to decline and marked 17.9% by the end of 2025. This stability is driven by a decline in construction starts over the last two years and strong absorption rates that exceed historical averages.
Average asking rents declined by -3.0% over the past 12 months, with the greatest drops in the Class A sector at -4.8%. This is largely due to the immense amount of supply that has come online in the past few years, which increased the amount of lease-up competition. To attract tenants, owners are offering an average concession of 2.7% off asking rents, which is nearly triple the national average of 1%.
Huntsville’s long-term outlook remains exceptionally strong, underpinned by sustained federal and privatesector investment, a rapidly expanding aerospace and technology employment base, and disciplined growth that continues to drive population inflows, income gains, and resilient rental demand.

Huntsville Multifamily Accolades

Source: CoStar Group, Inc.

The U.S. Space Command headquarters will be moving to Huntsville, which will add 1,400 jobs to the metro.
Key Findings $6B Eli Lilly plans on investing in a Huntsville manufacturing facility. The property will also create 450 new jobs.
#5 Ranked as the best city for renters to live for 2025.

Huntsville Demographics

Source: CoStar Group, Inc

Current Population: 549,831
Unemployment Rate: 2.7%
Median Household Income: $90,728
Households: 221,056

Employment Growth

Source: Huntsville Madison County Chamber

Population Growth

Source: Huntsville Madison County Chamber

Huntsville Multifamily Construction

Multifamily construction activity across Huntsville is transitioning as the recent wave of record-high deliveries begins to peak and moderate. The market saw the number of CO’s return to historical averages, with 3,737 certificates of occupancy granted. This marks a 28% decrease from 2024. High-profile, mixed-use developments continue to shape the city, including the $350 million MidCity District and the upcoming 11-acre Front Row project downtown, which is expected to complete its 545 residential units by the second quarter of 2026. The city also just approved the North Village Town Center, a $240 million development project that will bring 500,000 square feet of new retail and restaurants.

Multifamily permits issued deceased by 32% year-over-year, with roughly 938 units being permitted. The pipeline for units under construction is also more in line with historical averages. Of the 3,257 units across 14 communities that have been approved on active sites, 2,169 still remain to come online. Due to the influx of communities that have been delivered over the past three years, the competitive environment of new deliveries in lease-up has increased concessions and stalled rent growth across the sector.

Supply & Demand Dynamics

Source: CoStar Group, Inc.

Construction Starts (Units)

Source: CoStar Group, Inc.

Build-to-Rent (BTR) & Single-Family Rental (SFR) Construction

Huntsville remains one of the leading metros across the country for BTR and SFR additions, aided by the metro’s strong economy and increased population growth.

BTR properties are gaining popularity as they offer the space of a single-family home, but also feature the flexibility and modern amenities that renters want. Their prominence in Huntsville has led the metro to reach seventh place for BTR completions in 2024, and 10th for units underway throughout 2025.

2025 had the second-highest annual total for new housing units since the Development Review began keeping records in 1983. This is the third year in a row with a record-breaking number of new housing units, thanks to the influx of multifamily developments that began construction in late 20202023 that are coming to completion.

Huntsville Multifamily Sales

Over the course of 2025, Huntsville experienced both ends of the spectrum in terms of transaction types, with the institutional segment comprising the majority of total volume, and the distressed and/or heavy value-add segment comprising the rest. That said, the mid-market space saw very minimal activity, with very few being brought to market and only one transacting.

Throughout 2025, Huntsville’s sales rose in comparison to 2024. While there were only nine transactions that totaled over $123 million in sales volume in 2024, 2025 saw an uptick in both volume and transactions, totaling $165 million over 10 transactions.

Key Strengths

Strong institutional demand and capital deployment
Healthy pricing appreciation (19% YoY)
Consistent transaction velocity (10 deals)
High unit absorption (1,256 units)

Key Concerns

Wide range of deals from Class A, institutional to heavy value-add B & C product
Heavy volume concentration (78% in two quarters)
Missing mid-market creates limited diversity