Despite a disruptive pandemic, investor demand for multifamily real estate was strong in 2020, according to a newly released Yardi Matrix Bulletin.
Around 252,000 apartment units were absorbed last year. That’s about 1.7% of total market stock and down 12% from the 286,300 apartments purchased in 2019.
“Considering the economic and social calamity that befell the U.S., in many respects due to COVID-19, the fact that demand held up as well as it did is a relief for the apartment industry,” say Matrix analysts.
Net absorption was strongest in 25 of the 30 largest metros, which accounted for 158,300 units absorbed. Dallas, Atlanta and Denver saw the highest absorption rates.
Negative absorption was centralized in key gateway markets hit hard by COVID-19, which also struggled with renter demand and average rents. The worst performers were the Bay Area and New York City, which combined for -22,100 units absorbed in 2020.
Overall, high-cost gateway metros had net absorption of -0.3% (-7,600 units). Demand was better in secondary (154,100 units, or 2.3% of total stock) and tertiary (96,200 units, or 2.0% of stock) markets.
On a regional level, renters continued to flock to the Southeast (96,700 units absorbed, or 2.4% of total stock), the Southwest (56,800 units, 2.1% of stock) and the West (57,100 units, 1.9% of stock). Meanwhile, demand was slightly positive in the Midwest (27,100 units, 1.1% of stock) and the Northeast (4,900 units, 0.2% of stock).
Here are the top 10 markets based on net multifamily absorption in 2020:
1. Dallas: 19,233 units; 2.4% net absorption of total stock; 93.8% occupancy rate in Dec. 2020
2. Atlanta: 12,864; 2.8%; 94.7%
3. Denver: 11,552; 4.0%; 94.5%
4. Phoenix: 10,082; 3.2%; 95.5%
5. Houston: 8,377; 1.3%; 92.1%
6. Austin, Texas: 7,893; 3.1%; 93.3%
7. Miami: 7,721; 2.5%; 94.4%
8. Tampa, Fla.: 6,196; 2.8%; 95.4%
9. Charlotte, N.C.: 6,073; 3.3%; 95.1%
10. San Antonio: 5,836; 2.8%; 93.0%
Related Stories
| Jul 2, 2014
SHoP designs what would be Brooklyn's tallest building
JDS Development partners with SHoP to construct a 70-story building at 775-feet tall, unprecedented for downtown Brooklyn.
| Jun 30, 2014
Research finds continued growth of design-build throughout United States
New research findings indicate that for the first time more than half of projects above $10 million are being completed through design-build project delivery.
| Jun 30, 2014
Narrow San Francisco lots to be developed into micro-units
As a solution to San Francisco’s density and low housing supply compared to demand, local firms Build Inc. and Macy Architecture each are to build micro-unit housing in a small parcel of land in Hayes Valley.
| Jun 30, 2014
Harvard releases the State of the Nation’s Housing 2014
Although the housing industry saw notable increases in construction, home prices, and sales in 2013, household growth has yet to fully recover from the effects of the recession, according to a new Harvard University report.
| Jun 30, 2014
OMA's The Interlace honored as one of the world's most 'community-friendly' high-rises
The 1,040-unit apartment complex in Singapore has won the inaugural Urban Habitat award from the Council on Tall Buildings and Urban Habitat, which highlights projects that demonstrate a positive contribution to the surrounding environment.
| Jun 30, 2014
Gen X, not Baby Boomers, spending the most money on homes [infographic]
It turns out that Generation X, who have the highest incomes of the three generations surveyed, are paying the highest home payments and tend to have the largest households.
| Jun 25, 2014
The best tall buildings of 2014
Four high-rise buildings from multiple continents have been selected as the best of their region. The best worldwide tall building will be announced November 6.
| Jun 20, 2014
Sterling Bay pulled on board for Chicago Old Main Post Office project
Sterling Bay Cos. and Bill Davies' International Property Developers North America partner up for a $500 million restoration of Chicago's Old Main Post Office
| Jun 19, 2014
First Look: 10 Design unveils new luxury apartments plan in Dubai
The Seventh Heaven complex features a stepped form that will offer stunning views of the Dubai skyline.
| Jun 19, 2014
First look: JDS Architects' roller-coaster-like design for Istanbul waterfront development
The development's wavy and groovy design promises unobstructed views of the Marmara Sea for every unit.