Invest In Apartment Buildings In Des Moines, IA

Where Des Moines Apartment Demand Comes From

Des Moines has 35,599 renter households, and 39.5% of its households rent (U.S. Census ACS 2020–2024), far above the Iowa rate of 28.3%. Des Moines is the state capital and the core city of its metro, and its housing is old: the median home was built in 1961. Median gross rent is $1,090 a month, up 27.5% from $855 in the 2015–2019 survey, while median household income rose 23.2% to $65,932. The city's population dipped 1.5% to 212,421, but renter households still grew 3.9%, so more of the people living here now rent.

Insurance, banking, health care and grocery retail drive the job base. The Greater Des Moines Partnership's 2026 major employer list puts four regional employers at 10,000 or more workers: Casey's General Stores, Hy-Vee, UnityPoint Health and Wells Fargo. MercyOne and Principal follow in the 5,000 to 9,999 range, and Amazon, Athene, Bridgestone, Corteva Agriscience and Broadlawns each employ 1,000 or more. Drake University adds a student and staff population in the neighborhood that bears its name.

That mix gives landlords a large white-collar renter base downtown and a steady pool of hospital, warehouse and service workers in the older neighborhoods. Rents are modest by national standards, but 48.8% of renters still spend 30% or more of their income on housing, so pricing power has limits.

New Supply And Rents In Des Moines

Des Moines has absorbed a real construction wave. The Census counts 25,844 homes in buildings with five or more units, 26.5% of all housing, and that number rose 14.3% in five years, fast growth for a city with housing this old. CBRE's reports, as covered by Business Record, show what that supply did to occupancy. Metro occupancy fell to 92.9% in the first half of 2025, the lowest since late 2020, and vacancy reached 7.3% at the end of 2025. The city of Des Moines ran higher, at 8.2%, and the central business district at 8.5%. New buildings were offering one or two months free to fill units.

The market started to firm in 2026. CBRE's mid-2026 review, cited by Hubbell Realty, put metro occupancy at 93.7% and average asking rent at $1,216, up 2.9% from a year earlier. Only 723 units were delivered in the first half of 2026, though more than 3,100 remain under construction and about 4,700 more are planned. Downtown has carried a large share: in mid-2025, 1,071 of the metro's units under construction were in the central business district, and the pipeline included office-to-apartment conversions such as the Financial Center at 606 Walnut Street and Two Ruan Center.

The Census rental vacancy rate for the city is 5%. It counts every rental, including houses and duplexes, so it differs from CBRE's figures for larger apartment communities. The HUD fiscal 2027 fair market rent for a two-bedroom in the Des Moines-West Des Moines area is $1,360, above the city's median rent. For investors comparing apartment syndications in Des Moines, the question is how much nearby lease-up competition a property faces, and whether an older building's rents can hold while new downtown units are still offering concessions.

Des Moines Neighborhoods We Watch

Rent levels and building types vary widely across these close-in neighborhoods.

Des Moines By The Numbers

Out of 21 Iowa cities in our data, Des Moines comes in 9th for median gross rent, 4th for renter share and 6th for five-year rent growth. Its rents fall in the middle of the pack. Put in counts rather than percentages, that is roughly 3,215 fewer residents, 1,336 more renter households and 3,233 more homes in buildings with 5 or more units than five years earlier. New homes in 5+ unit buildings outpaced the growth in renter households, so newer buildings are competing for tenants and older ones may need to offer more to keep them.

Des Moines And Nearby Markets Side By Side

Des Moines's median gross rent of $1,090 is above the Iowa median of $972, and its renter share is 39.5% compared with 28.3% statewide.

Rent Versus Income In Des Moines

At $1,090 a month, the median Des Moines rent adds up to $13,080 a year, or roughly 19.8% of what the median household earns. Under the common 30% guideline, a household needs about $43,600 a year to cover that rent comfortably. That's a heavier load than the Iowa average of 15.5%. Renters usually earn less than the all-household median, so the real burden for tenants is higher than this simple ratio shows.

In dollars, Des Moines rent climbed $235 a month over five years and household income climbed $12,416 a year. Rent has outpaced income, so we are careful about how much further a business plan pushes rents on renewal. HUD's FY2027 Fair Market Rent for a two-bedroom unit, $1,360, is 24.8% above the median gross rent for all unit sizes. That gap matters for buildings that accept Housing Choice Vouchers, since local housing authorities base voucher payment standards on it.

Quick Facts: Des Moines Rental Market

Here's the Des Moines rental market in short form, with the source on every figure.

• Des Moines, IA has 212,421 residents, down 1.5% from the 2015–2019 survey (U.S. Census ACS 2020–2024).
• Median household income in Des Moines, IA is $65,932, up 23.2% over five years (U.S. Census ACS 2020–2024).
• Median gross rent in Des Moines, IA is $1,090 a month, up 27.5% over five years (U.S. Census ACS 2020–2024).
• 39.5% of households in Des Moines, IA rent, about 35,599 renter households (U.S. Census ACS 2020–2024).
• 26.5% of homes in Des Moines, IA are in buildings with 5 or more units (U.S. Census ACS 2020–2024).
• The rental vacancy rate in Des Moines, IA is 5%, and 48.8% of renters spend 30% or more of income on rent (U.S. Census ACS 2020–2024).
• The median home in Des Moines, IA was built in 1961 (U.S. Census ACS 2020–2024).

What We Look For In A Des Moines Apartment Building

We look at buildings with 5 or more units in Des Moines, from small walk-ups to larger garden-style communities, in stabilized or value-add condition. We compare in-place rents with nearby buildings, inspect roofs, plumbing and HVAC, and ask whether better management or targeted renovation can close the gap with the market.

Property taxes are a big line item for any Iowa apartment building. We estimate the tax bill as it will be after the purchase, because a sale can trigger a reassessment in many places. Iowa has no statewide rent control law, though local rules on notices, fees and deposits still apply. Insurance quotes in Iowa reflect hail and wind damage and winter storm and frozen-pipe claims, so we get a quote before we make an offer.

After a stretch of fast rent growth, we keep rent assumptions modest and leave room for concessions if new supply opens nearby.

Due Diligence For Apartment Syndications In Des Moines

The data on this page turns into a short checklist for evaluating an apartment syndication in Des Moines.

• What vacancy does the plan assume? Rental vacancy in Des Moines is 5%. A plan that assumes much lower vacancy than the market should explain why.
• What rent growth is underwritten? Rents here rose 27.5% over five years. Ask whether the plan assumes that pace continues, and what happens to the deal if rents stay flat.
• How was the property tax bill estimated? A sale often triggers a reassessment, so the bill after purchase can be well above what the seller pays today.
• What capital work is budgeted? The median home in Des Moines was built in 1961, so roofs, plumbing and electrical systems deserve their own line items.
• How will the building compete with new supply? Homes in 5+ unit buildings in Des Moines rose 14.3% over five years, so newer properties are part of the competition.
• How and when does capital come back? Ask what the plan is for a refinance or sale, and what happens if that takes longer than expected.

How Passive Investing In A Des Moines Apartment Syndication Works

Two groups make an apartment syndication work. The sponsor, or general partner, handles the deal: finding the building, financing it and running the business plan. The limited partners are passive investors who contribute capital and share in the property's results under the offering's terms.

Syndications are long-term and illiquid, and capital usually stays committed for several years. Results are never certain. Most offerings are limited to accredited investors, and the rules depend on whether a deal uses Rule 506(b) or Rule 506(c). See investing with Skyline Capital for how we work with limited partners.

Getting Started

The first step is the investor network. It's free, and it's how we share market notes and get to know investors. If we buy in Des Moines or elsewhere and you're eligible, we'll reach out privately with the details.