Demand for apartments in Baton Rouge surges as housing prices and interest rates climb

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Before the COVID-19 pandemic, rental rates and occupancy levels in the Capital Region were slipping, as the market slowly absorbed properties built since 2017.

That changed in 2021 and 2022, as the Baton Rouge area joined the national trend of rising rents and falling vacancies. To be sure, local costs didn’t spike as much as some red-hot markets or even keep up with the average national increase, which at the end of this April was above 16% year over year.

But rental rates in a matched set of local apartments checked early this year had “rocketed upward” 10% compared to last year, according to data Cook, Moore, Davenport & Associates, LSU’s Real Estate Research Institute, the Greater Baton Rouge Association of Realtors and the Baton Rouge Apartment Association compiled for the annual Baton Rouge TRENDS real estate report. Rates were basically flat the year before.

Meanwhile, the vacancy rate declined from about 9.2% last spring to about 4.9% this spring, based on a survey of 252 apartment complexes. The historical average is around 6% to 7%.

In recent years, most new units have been upscale properties marketed toward the higher end of the rental scale. The incoming supply for 2022-2023 is more focused on the affordable market, with 1,669 of the 2,595 units underway falling into that category.

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