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
Giants 400 | Sep 20, 2017
Bubble? What bubble?: Apartment and condo construction simply can't keep up with demand
Since the current multifamily boom took off in 2010, most activity has focused on large urban areas.
Multifamily Housing | Sep 20, 2017
New housing development rises from a historic textile mill’s ashes
Loft Five50 will add 137 housing units to Lawrence, Mass.
Multifamily Housing | Sep 19, 2017
Top 90 multifamily construction firms
Lendlease, Suffolk Construction, and Clark Group top BD+C’s ranking of the nation’s largest multifamily sector contractor and construction management firms, as reported in the 2017 Giants 300 Report.
Giants 400 | Sep 18, 2017
Top 40 multifamily engineering firms
WSP, AECOM, and Thronton Tomasetti top BD+C’s ranking of the nation’s largest multifamily sector engineering and EA firms, as reported in the 2017 Giants 300 Report.
Multifamily Housing | Sep 15, 2017
Hurricane Harvey damaged fewer apartments in greater Houston than estimated
As of Sept. 14, 166 properties reported damage to 8,956 units, about 1.4% of the total supply of apartments, according to ApartmentData.com.
Giants 400 | Sep 14, 2017
Top 95 multifamily architecture firms
Humphreys & Partners Architects, KTGY, and Perkins Eastman top BD+C’s ranking of the nation’s largest multifamily sector architecture and AE firms, as reported in the 2017 Giants 300 Report.
Multifamily Housing | Sep 5, 2017
Free WiFi, meeting rooms most popular business services amenities in multifamily developments
Complimentary, building-wide WiFi is more or less a given for marketing purposes in the multifamily arena.
University Buildings | Sep 1, 2017
The University of Texas receives boutique-style student housing complex
The Ruckus Lofts provide 46 furnished units and 165 beds for UT students.
Mixed-Use | Aug 30, 2017
Former industrial building becomes 'lifestyle community' in ever-evolving Baltimore
The new community offers 292 apartments with 20,000 sf of retail space.
University Buildings | Aug 25, 2017
‘Chapel of food’ becomes one of Clemson’s go-to spaces on campus
The new dining hall is part of the school’s ongoing efforts to maintain its standing among the country’s top 20 public universities.
