Corvallis–Albany Multifamily Market Update [4/16/26]

Welcome back to Multifamily Market Watch. I’m Michael Pierce, senior data analyst to HFO Investment Real Estate. Today we’re heading to Oregon’s Mid Valley, Corvallis and Albany, two markets that sit right next to each other, but are behaving very differently right now. And this is one of those markets where the headline numbers tell you one story and the real story is happening underneath.

The Big Picture

Let’s start with the big picture. Across Corvallis and Albany combined, you’re looking at a market of about 14,000 apartment units with vacancy sitting around mid 4% range, so demand is still there. This is not a weak market, but rent growth, that’s basically flat, right around zero, maybe slightly positive. So the shift is this: the market is not broken, but it has stopped accelerating, and that’s a very different environment for owners and investors.

Corvallis

Now, let’s break the two markets apart. Corvallis is still the tighter of the two, vacancy around 4.2% rents roughly 1480 to 1500 a month, and importantly, no new deliveries in the past year. So, on paper, this looks like a classic supply-constrained market, but absorption has actually been slightly negative, so demand is there, but it’s not pushing rents anymore.

Albany

Albany tells a different story: vacancies around 5% rents closer to 1400 a month, and about 177 units delivered in the past year, that’s real supply, but there’s the key: Albany absorbed most of it. So, this isn’t a weak market, that’s a market that took supply and is adjusting to it. Simple framing is Corvallis equals tight but flat, Albany equals softer but stabilizing.

Corvallis Development Pipeline

Now, here’s the most important part of the discussion. If you look at CoStar, Corvallis shows around 90 units under construction, that’s it. So, naturally, you think there’s no supply chain coming. The market should stay tight, right? But the reality is, when you look beyond Costar into city data, local reporting, and development tracking, you’re actually seeing 300 plus actively under construction, and closer to four to 500 total units when you include affordable and mixed-use projects. To put that in context, Corvallis has a market of about 7700 units total, so instead of a 1% pipeline, you’re looking at something closer to five to 7% of inventory in motion. That’s a completely different story. So, why the gap? Because Costar is missing affordable housing, subsidized projects, early stage developments, and most importantly, student housing.

Oregon State University Housing Impact

Now we have something I like to call the OSU effect. The real driver here is the Oregon State University. This is the anchor of the Corvallis housing market. Here’s some key numbers: enrollment around 38,000 to 39,000 students, and growing on campus housing today is roughly 5000 beds, and a long-term goal of 7500 That’s an increase of about 2500 beds over time, and that’s already happening. You’re seeing projects like a 680 bed residence hall being erected, private student housing development with hundreds of beds and additional proposals in the pipeline, so the key insight is student housing doesn’t always show up as units, it shows up as beds. So, when a six or 700 bed gets delivered, that’s equivalent to two or 300 apartment units of impact, but it doesn’t show that way up in the data.

What does it all mean?

Okay, so what does this mean for the markets? We’ve got two forces happening here on the demand side, we have 38,000 students, a stable employment base, and limited traditional supply. On the supply side, we have 400 plus units in a broader pipeline, 1000s of future student beds coming up, and growing affordable housing stock that creates a split market. Traditional apartments that feel tight, but a new supply is quietly increasing competition, and that’s why rent growths have flattened, not because demand disappeared, but because supply is finally starting to respond.

Corvallis Pricing and Cap Rates

Now, let’s bring it back to the investors. Corvallis, the pricing is around 200k per unit, and the cap rates are in the mid 5% range right now. Albany sales are closer to 170k per unit, with cap rates around 6% So, the translation here is Corvallis has the premium pricing based on perceived scarcity, and Albany has more yield and more flexibility, so the risk is if you’re buying in Corvallis, assuming no supply, you may be paying tomorrow’s prices on yesterday’s assumptions. In context to the economy, this is an area for stable demand, but not one that can outrun supply mistakes.

Housing Demand in Corvallis and Albany

If we zoom out and look at long-term housing needs, both markets will still need housing long term, of course. State estimates show that roughly seven 8000 units are needed over the next 20 years for each market, so yes, short term equals supply catching up, long term equals still under supplied.

The Key Takeaway

Here’s the key takeaway: Corvallis and Albany are not declining markets, but they are changing markets. Corvallis looks pretty tight, but supply is coming, and Albany looks soft, but is stabilizing. And for investors, this is the shift – it’s no longer. Chasing rent growth, it’s about understanding timing, because in this market the biggest risk is in vacancy, it’s misreading the pipeline. Thanks for listening. I’m Michael Pierce. This has been Multifamily Market Watch. Talk to you next week.

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