In its latest outlook report for the multifamily rental market, Yardi Matrix outlined several reasons for hope for a solid recovery for the multifamily housing sector in 2021, especially during the second half of the year.
While multifamily owners, developers, and property managers collectively braced for severe drops in rent growth, construction starts, project completions, and availability of capital amid the COVID-19 pandemic, the drastic declines never materialized.
Rent growth did take a step back in select markets, especially in "high-cost gateway" metros like San Jose (-13.7%) and San Francisco (-9.4%), as renters continued to leave pricey urban neighborhoods for less-dense, cheaper suburban areas.
But on the flip side, "many tertiary and tech hub markets have benefited from migration out of the gateways," wrote the authors of the Yardi Matrix report. Secondary and tech markets like the Inland Empire, Sacramento, Tampa, and Las Vegas all saw solid rent growth in 2020.
Multifamily construction pipeline for 2021
Other than the temporary shutdowns of work sites during the pandemic, construction work on multifamily housing developments continued to hum along through 2020 and into 2021. In all, 285,000 multifamily units were delivered throughout U.S. markets in 2020, down about 7% from 2019, but not nearly as severe a drop as many had predicted.
According to Yardi Matrix, the multifamily sector has a "robust pipeline" of new projects, with some 765,000 units in some stage of construction as of early 2021. This "should keep deliveries above that 300,000 mark for the next few years." The firm projects 327,718 units will be delivered in 2021.
Here are the top 25 multifamily markets for 2021 (total number of construction completions, % growth in completions YOY):
1. Dallas: 22,909 completions (+12.1% YOY)
2. Miami: 16,262 (+66.3%)
3. Washington, D.C.: 14,541 (+50.5%)
4. Houston: 11,500 (-3.1%)
5. Los Angeles: 11,296 (+16.5%)
6. Atlanta: 10,939 (+9.7%)
7. Austin: 10,301 (-10.0%)
8. Seattle: 9,816 (+29.9%)
9. Phoenix: 9,334 (+13.6%)
10. Denver: 8,653 (-29.7%)
11. Boston: 8,449 (+20.8%)
12. Chicago: 7,797 (+0.8%)
13. New York City: 7,335 (+24.2%)
14. San Francisco: 7,166 (+64.8%)
15. Twin Cities: 6,760 (+4.9%)
16. Charlotte: 6,692 (+55.3%)
17. Orlando: 6,662 (+21.5%)
18. Philadelphia: 6,071 (+27.7%)
19. Nashville: 5,457 (+41.1%)
20. Tampa–St. Petersburg: 5,103 (+20.1%)
21. San Antonio: 4,960 (-6.5%)
22. New Jersey–Northern: 4,955 (+29.9%)
23. Salt Lake City: 4,633 (-0.6%)
24. Louisville: 4,484 (+215.6%)
25. White Plains: 4,464 (+199.6%)
DOWNLOAD THE FULL REPORT
Related Stories
Multifamily Housing | Mar 18, 2015
Prefabricated skycubes proposed with 'elastic' living apartments inside
The interiors for each unit are designed using an elastic living concept, where different spaces are created by sliding on tracks.
Multifamily Housing | Mar 16, 2015
New Jersey Supreme Court puts control of affordable housing agency in the courts
The court said the state’s affordable housing agency had failed to do its job, and effectively transferred the agency's regulatory authority to lower courts.
High-rise Construction | Mar 16, 2015
Mexican Museum tower caught in turmoil to break ground this summer in San Francisco
Millennium Partners said it will break ground on the 53-story residential and museum tower while the lawsuits go through the appeals process.
Mixed-Use | Mar 13, 2015
Dubai announces mega waterfront development Aladdin City
Planned on 4,000 acres in the Dubai Creek area, the towers will be covered in gold lattice and connected via air-conditioned bridges.
High-rise Construction | Mar 12, 2015
Developers confirm Renzo Piano’s contribution in Sydney harbor overhaul
If the entire development is approved, One Sydney Harbour will be Piano’s second project in Australia.
Multifamily Housing | Mar 12, 2015
Multifamily construction has been a boon to L.A.’s economy
A new study finds that nearly one-quarter of Los Angeles’ population lived in rental homes and apartments in 2013, a number that undoubtedly has increased since.
Modular Building | Mar 10, 2015
Must see: 57-story modular skyscraper was completed in 19 days
After erecting the mega prefab tower in Changsha, China, modular builder BSB stated, “three floors in a day is China’s new normal.”
Multifamily Housing | Mar 10, 2015
Developers bullish about multifamily market for third consecutive quarter
After increasing steadily over the past several years, multifamily production has now reached a healthy, sustainable level, according to NAHB Chief Economist David Crowe.
Multifamily Housing | Mar 10, 2015
A loft project in Dallas evolves into a high rise for both affluent and artistic customers
Atelier | Flora Lofts will be built on one of this city’s last choice undeveloped lots.
Multifamily Housing | Mar 10, 2015
KTGY homes in on seniors with new studio
Its director, Doug Ahlstrom, says designs will emphasize socialization and community.