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Phoenix ranks No. 6 among hottest multifamily markets

New research shows that Phoenix is the sixth hottest U.S. market for multifamily sales over the last decade.

Over the past decade, the price-per-unit (PPU) for multifamily properties surged 156%, reaching nearly $160,000. This increase surpassed both median home sale prices and rental rates.

The latest CommercialSearch study compared and ranked the most active U.S. metros in terms of multifamily sales since 2009.

READ MORE: Phoenix No. 2 among hottest housing markets of 2021

Here are some highlights:

• Phoenix is the sixth hottest U.S. market for multifamily sales over the last decade. Since 2009, Phoenix registered more than $42 billion in multifamily sales.

• In terms of transactions, 1,711 deals were completed across the metro since 2009, totaling 385,717 units.

• In 2020 alone, Phoenix closed 125 deals, claiming the 3rd spot. The market had only 21 deals less than DFW, which took #1.

• For comparison, nationally, the average rent saw a 37% increase to $1,462 and the median home sale price was up roughly 58% since 2009 to $313,200.

Never have we spent so much time in our homes. Median prices are at their highest level in generations. A supply shortage and interest rates that are on the floor — and likely to stay there for some time — mean prices continue to rise. The national median home sale price is up roughly 58% since 2009 to $313,200. In the last decade, as prices rose, home ownership rates slowly declined. In 2016, the homeownership rate in the U.S. was 62.9%, the lowest level since 1965. Four years later, the home ownership rate neared its peak reached before the housing crisis, 67.9%, with much of the uptick being driven by cheap borrowing costs. However, the pandemic has caused rates to fall back to 65.8% as of Q4 2020.


In the same time period, growth in national rental rates has been somewhat tempered, rising 37% to $1,462. For multifamily investors, these increases pale in comparison to property prices. Nationally, the price-per-unit (PPU) that multifamily properties are selling for is up a whopping 156% since 2009 to nearly $160,000 from $62,371. Some large markets like Manhattan, San Francisco and Seattle had PPU increases north of 200% in 10 years.

Online marketplaces have put immense pressure on brick-and-mortar retail. At the same time, Industrial properties have been bifurcated into either essential or nonessential, with the latter being more susceptible to market fluctuations, like manufacturing, while logistics and fulfillment thrive. Multifamily as an asset class is positioned somewhat better during market downturns simply because there is always demand. People have to live somewhere. But as always, some markets are better than others.

Hottest Markets for Multifamily Deals – DFW, Atlanta & Phoenix

Dallas-Fort Worth has been the hottest market for multifamily properties over the last decade. The market is expansive, stretching across 11 counties and 9,300 square miles with many opportunities for development. Across the metro, 149,000 units were built since 2010, most in the nation by metro. It also had the most deal flow. 2,227 multifamily deals were completed in the last decade, totaling 516,693 units.

Atlanta may have been behind DFW in transactions, closing 2,134, but it had more units trade hands — 36,685 more, in fact — totaling 553,378 units. Phoenix, NYC and Houston all had around 1,700 deals completed by year-end 2019. Surprisingly, Houston tallied more than 425,000 units that changed hands while the much larger market of Los Angeles transacted 134,000.

Interestingly, Houston was keeping pace with DFW in multifamily transactions until 2015. Part of the reason the two diverged is that oil prices fell and the energy-concentrated business environment in Houston contracted as oil companies began layoffs, sending ripples through the local economy and real estate industry. Houston added less than 5,000 jobs in November of 2015, less than half of a typical month — and the third worst in 25 years.


There have been more than $912 billion in multifamily deals in the last 10 years. Nationally, multifamily deals registered $13.4 billion in 2009 and have skyrocketed since. Nearly $130 billion in multifamily sales closed in 2019 alone across the country with more than $82 billion closing last year.

New York City and Atlanta each completed more than $50 billion in multifamily sales since 2009, outpacing the most active markets and showcasing the significantly premium that real estate commands in these markets. For example, Atlanta closed 2,134 deals in the last decade, almost one hundred fewer deals than DFW. But, Atlanta’s sales volume was $6.3 billion more than DFW’s sales volume over the same period.

Some markets have seen incredible growth seemingly overnight. Austin had $390 million in sales in 2010. Just two years later it had nearly quadrupled to $1.65 billion and has hovered around $2 billion since 2014. Similarly, Las Vegas had less than $500 million in multifamily transactions in 2012 but closed over $1.1 billion the following year and kept growing to nearly $3.5 billion in 2019.

At the same time, markets like Seattle, Charlotte and the Carolina Triangle have seen immense growth in sales volume that has increased steadily every year. Charlotte had $76 million in sales in 2009 and has seen consistent growth over the last decade, closing out 2020 with nearly $3 billion in sales. Seattle went from $270 million to $6.8 billion in 2019 — an increase of 2,397%, before slowing last year to $1.9 billion in sales.