According to Joe Fairless, regardless of the multifamily market in which you choose to invest, you must be aware of current trends and take advantage of them. The most profitable areas for multifamily home investors have high cap rates and have shown to be profitable for their owners. Here are some of the greatest multifamily investing markets for 2021. Use real estate heatmaps like Mashvisor's to find these markets and determine which are the greatest bargains.
For years, the multifamily market in Dallas-Fort Worth has been blistering hot. In fact, for the sixth year in a row, the market has led multifamily investment transactions in the United States. In fact, multifamily investment volumes in Dallas-Fort Worth in 2021 surpassed those in 2020, with price increases averaging 33%. Dallas-Fort Worth, formerly considered a flyover city, has suddenly attracted the interest of national investors.
Competition for building sites is growing as the number of residential projects on the market grows. The rivalry for suitable sites grows as more developers begin constructing foundations. Furthermore, many towns in the DFW region limit the amount of units that a developer may build and demand dense development. With current rents, this makes it impossible to justify a project. These obstacles, however, do not nullify the potential upside of multifamily investing in Dallas-Fort Worth.
The rise of Dallas-Fort Worth is an inexorable trend for investors. Its population expansion has led to outperformance in other markets and high demand for multifamily housing. The area is the most sought-after multifamily market in 2021, according to Danny Baker, head of CBRE's DFW multifamily capital markets. It really outperforms the Atlanta market by almost $1 billion.
Joe Fairless pointed out that Atlanta's economy continues to outpace the market, bolstering multifamily fundamentals. This is wonderful news for investors who are already paying attention to the multifamily market in Atlanta. Alex Cathcart, FCP Vice President of Multifamily Acquisitions & Development, and Associate Cristina Istrate discuss Atlanta's multifamily market. For investors of all sizes and levels of expertise, investing in Atlanta's multifamily real estate market might be a viable decision.
Atlanta is one of the finest cities to invest in multifamily property, according to Vive Funds. Atlanta was immortalized in Margaret Mitchell's classic book Gone With the Wind, and there is still plenty of possibilities for the city. Atlanta offers a plethora of multifamily investment opportunities because to its strong population and employment growth rates. Many of the world's most well-known corporations have their headquarters in the neighborhood.
Despite the fact that many investors are waiting for the market to come back, there is still a high demand for apartment construction. The economy is prospering, rents are increasing, and the COVID vaccination is now widely accessible. Multifamily housing is an excellent investment opportunity in Los Angeles. Apartments are expected to be a top asset class next year, according to Yorck.
Despite the fact that Los Angeles is one of the most expensive cities in the United States, this does not stop investors. Indeed, Los Angeles routinely rates as the top real estate investment market in the Americas, outperforming Dallas-Fort Worth, San Francisco/Northern California, and others. As a result, multifamily is a hot investment market, and the scarcity of available housing makes it even hotter.
While the housing market in Texas is shielded from the broader economic and financial factors, certain areas nonetheless face a housing scarcity. The median income in San Antonio, for example, is rising, suggesting that demand for new multifamily buildings has not dwindled. The state's closeness to Austin, which is home to the Lackland Air Force Base, which employs over 25,000 people, is another plus for Texas multifamily investment. Despite the downturn, Texas remains an excellent area to invest in multifamily properties. In this bustling state, there are several chances to play and work.
In Joe Fairless’s opinion, if you want to invest in multifamily buildings, Texas is a terrific area to start. The Texas Triangle, which includes the cities of Dallas-Fort Worth, Houston, and San Antonio, is one of the state's most outstanding regions. These places have an average annual growth rate of almost 80%, making them appealing to investors. Another place to explore is West Texas, which has had localized population increase.