10 Markets with More Than 4% Rent Growth in Last 12 Months

Another important factor to analyze when you’re evaluating potential target investment markets is historical rent growth, which is also tied to supply and demand.

A strong year-over-year rent growth indicates a strong multifamily market.

Additionally, one of the important assumptions set when underwriting an apartment deal is annual income growth. That is, how much will my revenue naturally increase each year? Generally, somewhere between 2% and 3% is a solid, conservative assumption, due to being close to the national and historical rent growth and inflation averages. Therefore, if you are investing in a target market with a true rental growth that is greater than 2% to 3%, you are able to automatically add value just by selecting the right market!

Each quarter, CBRE gathers the most recent multifamily data and releases it in their U.S. Multifamily Figures Report (click here to view their most recent report, Q1 2019). The national year-over-year rent growth was 3.0%. But here are the 10 markets that saw a rent growth greater than 4.0%:

 

10. Jacksonville, FL

Y-o-Y Rent Growth: 4.1%

 

9. Raleigh, NC

Life Storage

Y-o-Y Rent Growth: 4.1%

 

8. Charlotte, NC

Greyhound

Y-o-Y Rent Growth: 4.2%

 

7. Tampa, FL

Parade

Y-o-Y Rent Growth: 4.3%

 

6. Austin, TX

GrandView Aviation

Y-o-Y Rent Growth: 4.7%

 

5. Riverside, CA

AreaVibes

Y-o-Y Rent Growth: 4.8%

 

4. Sacramento, CA

Y-o-Y Rent Growth: 5.1%

 

3. Atlanta, GA

Y-o-Y Rent Growth: 5.4%

 

2. Phoenix, AZ

Y-o-Y Rent Growth: 8.0%

 

1. Las Vegas, NV

Booking.com

Y-o-Y Rent Growth: 8.0%

 

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