
Delaware Multifamily Market Report (Q2 2025)
Delaware’s multifamily rental market is divided into three distinct counties — New Castle, Kent, and Sussex — each with its own market characteristics. This report breaks down current rents, vacancies, supply and demand drivers, development pipeline, and investment insights. It is designed for investors new to Delaware, aiming to spot strong opportunities.
New Castle County (Wilmington Metro)
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Rents: Highest in the state. 1BR ~ $1,500, 2BR ~ $1,674, 3BR ~ $2,033.
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Vacancy: ~6.0%, stable but trending slightly up due to new supply.
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Development: 42,277 units in 249 buildings. Low pipeline with only 174 units underway.
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Demand Drivers: Strong job base including finance (JPMorgan Chase, Bank of America), healthcare (ChristianaCare), and education (University of Delaware).
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Investment: Cap rates 6.5%. Highest price per unit in the state ($151K). Limited sales activity, signaling a hold market.
Key Submarkets:
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Wilmington: High-rise inventory, most new development. Short-term elevated vacancy but strong long-term fundamentals.
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Newark: Anchored by University of Delaware. Strong academic-driven demand. Low new supply.
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Middletown, Bear, Claymont: Suburban growth nodes, particularly Middletown with single-family expansion and new apartment supply.
Kent County (Dover Area)
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Rents: Most affordable in the state. 1BR ~ $1,264, 2BR ~ $1,441.
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Vacancy: Exceptionally tight at 3.1%. Many properties report waitlists.
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Development: 6,908 units total, with 228 under construction. Last year saw 238 units delivered.
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Demand Drivers: Dover Air Force Base, state government, and health systems drive demand. Fastest 5-year growth in mid-career age cohorts.
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Investment: Cap rates ~6.6%. ~$128K per unit. $82.5M in 12-mo sales volume — the most in the state.
Key Submarket:
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Dover: Central to Kent’s multifamily inventory. Stable renter base with strong absorption. Recent large deliveries leasing quickly.
Sussex County (Southern Delaware)
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Rents: Rents nearing New Castle levels. 2BR ~ $1,484, but studio average drags down the mean due to older inland stock.
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Vacancy: Highest in the state (9.5%) due to large recent deliveries — but strong absorption (~735 units) is keeping pace.
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Development: Fastest growing market. Inventory grew 12% last year. 766 units delivered. Pipeline now only 178 units.
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Demand Drivers: Retiree migration, beach economy, and workforce housing in towns like Georgetown and Millsboro.
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Investment: Highest cap rates (~7%). ~$136K per unit. Low transaction volume. Many new properties being held post-construction.
Key Submarkets:
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Rehoboth Beach / Lewes: Upscale rentals. High rent potential. Constrained development.
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Georgetown / Millsboro: Workforce-driven demand. Strong absorption and moderate rent levels. High potential for value-add or new construction.
