Using Origin MultilyticsSM and our boots-on-the-ground knowledge, we have identified five key cities where multifamily real estate investment could provide outsized returns.
Methodology
Multifamily Markets to Watch 2022 is compiled from Origin MultilyticsSM, our proprietary suite of machine-learning models that forecasts rent growth by aggregating and analyzing more than 2.7 billion data points per month to generate alpha in multifamily real estate investment. It was created by our in-house team of data scientists to support our study of high-growth areas for potential investment.
MultilyticsSM Features
More accurate than the industry standard
Uses data from hundreds of sources
Back-tested for ability to select markets
Markets
Phoenix
A steady, strong influx of jobs and people have tipped the supply-demand balance in favor of multifamily housing in Phoenix, where state economic development and education initiatives are paying off with a quality workforce, both home-grown and lured from higher-cost states like California. Chip manufacturers, electric-vehicle startups and warehousing businesses are moving in and creating jobs.
Differentiators:
Diverse, high-paying jobs
Business affordability
Increase in long-term residents
Tucson
Tucson may be the second city in Arizona, but it’s capitalizing on its proximity and relative affordability to make it a high-potential alternative to Phoenix. Infrastructure plans to connect the two cities, the growth of suburban manufacturing and solid year-over-year job growth — along with a university presence and a diverse business base — point to a strong trajectory for multifamily real estate growth.
Differentiators:
Affordability
Room to grow
Proximity to Phoenix market
Las Vegas
With jobs and income on the rise, Las Vegas is outgrowing its reputation as a mecca for gamblers and retirees and turning into a business-friendly alternative for out-of-staters, who love the climate and affordability. It's developing as a warehousing hub and key link in the national supply chain and is the future home of a $1 billion solar energy project. But it still knows how to have fun.
Differentiators:
Diversifying economy
No state or corporate taxes
A draw for out-of-state residents
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Austin
Bigger, faster, stronger: That’s the story of Austin. Big tech keeps coming, from Oracle and Tesla to Samsung, Apple and Facebook. One of the fastest-growing cities in the U.S. is attracting a high-quality, youthful workforce and the salaries that come with it and, despite a torrid housing market, it remains affordable compared with California and New York. The demand for multifamily real estate shows no signs of slowing down.
Differentiators:
Big tech only getting bigger
Still comparatively affordable
High-income earners keep coming
Nashville
The hits just keep on coming for Nashville, whose pro-business, lifestyle-friendly climate and culture continue to drive impressive growth. Steady increases in employment and income are expected to continue as planned tech and other jobs enter the market. Housing inventory is at its lowest in the area’s history, but its comparative affordability and dynamic personality offer many reasons for longer-term optimism.
Differentiators:
Established, but still hot, market
Impressive income and job growth
Friendly vibe, big-city ambitions
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Find out more about our outlook for potential multifamily real estate investment in these markets and why we think they’re worth watching. And read more about our unique approach and exclusive, exhaustive methodology.