For the first half of 2021, most of the rent increases occurred during the second quarter with Yardi reporting overall rents up 5.1 percent in 2Q over the previous year. Overall, rents are expected to rise 2.5 percent for 2021. Markets with the highest projected rent growth for 2021 include Phoenix Las Vegas Memphis, Tenn. Rent declines are expected to continue in some of these gateway markets but at more moderate levels. Freddie Mac expects positive rent growth across the majority of metros this year except in the six largest gateway markets-New York City, Boston, Miami, San Francisco, Washington, D.C., and San Jose, Calif.
The investor activity comes as demand for multifamily housing exceeds pre-pandemic levels with nearly 90 percent of metros expecting to see positive rent growth in 2021, compared to 50 percent of all markets in 2020. economy is expected to continue this year and likely into 2022. While there are concerns about more virulent strains of COVID-19 impacting areas with lower vaccination rates, the general consensus is the growth in the U.S. The report notes that a year after the pandemic caused the economy to bottom out in the second quarter of 2020, GDP, total employment, unemployment rates and jobless claims have all improved significantly. Those projections are even stronger than those in the report released in late January which expected overall multifamily origination volume to reach $340 billion by year-end.įreddie Mac Multifamily notes rapidly improving economic conditions and loosening of restrictions throughout the country have improved the outlook for the multifamily market. Rising rents and falling vacancies are helping fuel strong investor demand in the multifamily sector and should lead to record-setting origination volume between $385 billion and $410 billion for the year, according to the Freddie Mac Multifamily Midyear Outlook.
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