The year 2023 could be considered the first relatively normal year since the onset of the pandemic, following two years of record performance within the multifamily market. The sector still advanced but at a slower pace. Going into 2024, the multifamily industry faces a mixed outlook. Last year’s main challenges persist—rising inflation, interest rates and high expenses, as well as a looming economic slowdown. In addition, the multifamily market had some 1.2 million apartment units under construction at the start of 2024, 510,000 units of which are expected to come online by year’s end. Therefore, supply expansion will play a great role in the market’s performance on a metro level.
Using Yardi Matrix data, we looked at what smaller markets saw performance in a few key areas and have positioned themselves for further growth. We analyzed employment, deliveries and the construction pipeline, occupancy performance and levels, as well as property values, looking at average per-unit prices. Each of these metrics was assigned a final score, which created our ranking. Here are 2024’s top 10 emerging multifamily markets in the U.S.
1. Omaha, Nebraska
The Gateway to the West scored highest in our ranking. The third most populous metro on the list, Omaha had 4,506 units delivered in 2023, which is the second largest volume by unit number among the markets in this cohort. Occupancy remained tight at 96.0 percent as of November, following a small 40-basis-point decline year-over-year. Strong demand for apartments boosted the pipeline, with developers having 8,000 units under construction in December, the second largest pipeline in this list.
Economic activity was moderate, with the employment market expanding just 1.5 percent in the 12 months ending in October, trailing the 2.3 percent U.S. rate. However, the jobless rate stood at 2.5 percent in November, the tightest job market among the metros in this analysis, and well ahead of the 3.7 percent national rate, according to data from the Bureau of Labor Statistics.
Omaha is one of the most affordable multifamily markets nationally, and the most affordable one in this group. The average price per unit as of December clocked in at $130,739, following a solid 15.4 percent increase year-over-year. Meanwhile, the U.S. rate decreased 11.3 percent to $185,172. Overall, investors traded $275 million in multifamily assets in Omaha in 2023.
2. Greenville, N.C.
Located 101 miles from Charlotte and 145 miles from Atlanta, Greenville is the fifth most populous on this list, with nearly 1 million residents. Developers delivered 3,646 units last year and had a strong pipeline underway, amounting to 6,563 units as of December. The metro’s occupancy was at 94.0 percent in November, falling by 75 basis points year-over-year.
Similar to Omaha, the metro’s employment market expanded by 1.5 percent in the 12 months ending in October, with the 2.9 percent unemployment rate outperforming the U.S. rate by 80 basis points, according to BLS data.
The average per-unit price was up by a hefty 22.3 percent year-over-year in December to $195,802, just above the U.S. figure. Investors traded $655 million in multifamily assets in 2023 in Greenville, which is the second-largest volume among the metros in this ranking.
3. Southwest Florida Coast
The region represents the contiguous space below Tampa-St. Petersburg, down and consists of the Fort Myers and Sarasota markets and surroundings. It’s the fourth most populous entry in this list, just behind Omaha. A sought-after geographic location, the area is very appealing to developers, leading all other metros in this group by units delivered, with 5,463 apartments coming online in 2023. More so, the construction pipeline had a substantial 16,166 units underway in December, the highest volume in this group. This robust supply expansion left a mark on the occupancy rate, down 2.6 percent year-over-year as of November to 94.0 percent.
The employment market expanded 2.2 percent year-over-year as of October, only behind Knoxville in this ranking, just 10 basis points below the U.S. rate. The jobless rate stood at 3.3 percent in November, leading the U.S. by 40 basis points.
Among the least affordable multifamily markets in this group, Southwest Florida Coast’s price per unit rose 15.3 percent year-over-year in December to $276,371, considerably above the $185,172 national average. Investment activity was elevated in the area, with an investment volume of $872 million, the highest in this group.
4. Wilmington, N.C.
One of the smallest metros in this ranking, Wilmington is the gateway to Cape Fear Coast beaches. In 2023, developers brought online 1,071 units and had a considerable 3,956-unit pipeline in December. Deliveries dented the occupancy rate, down 1.5 percent year-over-year in November to 93.0 percent.
Wilmington is the only market in this ranking where the employment market contracted, but not by much, down 0.2 percent year-over-year. Even so, the unemployment rate was at 3.1 percent in November, outperforming the 3.7 percent national rate.
The average price per unit in Wilmington posted the largest increase among the metros in this group, up by a substantial 35.0 percent year-over-year in December, to $273,079. At this level, it ranked fourth highest among the markets in this ranking and surpassed the U.S. figure. Still, investment activity was tepid, with $240 million in multifamily assets trading in 2023.
5. Eugene, Ore.
The only market in this list located on the Western Coast, Eugene lies 110 miles south of Portland. Its inventory expanded by 923 units in 2023, which kept occupancy in check, down 70 basis points year-over-year through November to 96.0 percent. Meanwhile, the pipeline had 4,004 units under construction in December.
The employment market posted tepid performance in the 12 months ending in October, expanding 1.5 percent. The unemployment rate was among the highest in this ranking, at 3.5 percent in November, but still slightly better than the 3.7 percent U.S. rate, according to BLS.
Eugene is the second most expensive multifamily market in this group by the average price per unit, at $288,144 in December, following a 22.3 percent year-over-year increase. In 2023, the multifamily investment volume rose to $301 million, occupying a mid-position in our list.
6. Augusta, S.C.
Another metro in the Carolinas, Augusta is the smallest in this group by population figure. However, its geographic location and healthy demand for housing encouraged developers to deliver 1,847 units in 2023. The 2,579 units under construction as of December might impact the occupancy rate down the line: it clocked in at 92.0 percent as of November—the lowest rate among the markets in this list—following a 1.2 percent year-over-year decline.
The job market expanded just 0.9 percent in the 12 months ending in October, posting one of the weakest performances among the metros in this group. In addition, the jobless rate stood at 3.9 percent in November, the highest in this list and 20 basis points above the U.S. average.
Augusta is one of the most affordable multifamily markets in this list, with the average per-unit price at $163,356 in December, even after a substantial 27.7 percent year-over-year increase. It also posted the lowest investment volume in 2023, totaling $131 million.
7. Chattanooga, Tenn.
Nestled between Nashville, Knoxville and Atlanta, Chattanooga’s notoriety has been rising over the past decade. In 2023, 1,139 units came online in the metro, and as of December, developers had 2,780 units under construction. The occupancy rate in stabilized properties remained at a healthy 95.0 percent as of November, inching down 40 basis points year-over-year.
The employment market grew 1.6 percent year-over-year as of October, 70 basis points below the U.S. rate. The jobless rate was at 3.6 percent in November, just under the national average by 10 basis points.
Chattanooga is the third most affordable metro in this ranking, with an average per-unit price of $143,928 in December, lagging the $185,172 national average. While the price per unit rose 18.3 percent year-over-year, the investment volume was second lowest among the metros in this list, totaling $156 million.
8. Winston-Salem – Greensboro
The fourth metro in the Carolinas region, Winston-Salem – Greensboro is the most populous of all the markets in this analysis and is situated northeast of Charlotte and west of Raleigh - Durham. Developers finalized 2,903 units in 2023 and had 4,549 units under construction in December. The occupancy rate decreased 90 basis points year-over-year in November, to 93.0 percent.
The job market expanded 1.5 percent year-over-year as of October, on par with Omaha, Greenville and Eugene, while lagging the 2.3 percent U.S. rate. Unemployment rose to 3.5 percent in November, surpassing the 3.7 percent national rate.
The second most affordable market in this group, Winston-Salem – Greensboro posted the weakest year-over-year increase in the price per unit, up just 2.4 percent in December, to $136,963, well below the national amount. The low value attracted investors, which traded $486 million in multifamily assets in 2023, the third highest volume among the markets in this list.
9. Knoxville, Tenn.
Down b a spot in the emerging markets list, Knoxville first appeared in this ranking last year, when it occupied the eighth position. While the supply expansion was limited in 2023, when just 517 units came online, the metro had ten-fold the pipeline, as 5,613 units were under construction in December. The new stock will help ease some of the pressure, as the occupancy rate was among the highest in the U.S., at 97.0 percent in November, following a 60-basis-point year-over-year decline.
The metro’s economic growth was strong, up 3.7 percent in the 12 months ending in October and well above the 2.3 percent national average. The unemployment rate stood at 3.3 percent in November, faring better than the 3.7 percent U.S. level.
The price per unit rose 6.6 percent year-over-year through December, which is modest compared to the majority of metros in this group. At $218,939, Knoxville’s average per-unit price was above the $185,172 U.S. figure. In 2023, sales volume reached $375 million.
10. Long Island, NY
Last year, developers added just 485 units, which explains the tight occupancy rate of 97.0 percent in November. Long Island is the only metro in this group that posted an increase in occupancy, albeit a small 0.1 percent increase year-over-year. The pipeline points to some relief, as there were 3,696 units under construction in December.
In the 12 months ending in October, the island’s employment market posted a feeble 0.8 percent growth, well below the national rate. The jobless rate stood at 3.3 percent in November, outperforming the 3.7 percent U.S. average, according to preliminary data from the BLS.
Expectedly, the metro is the most expensive in this group, with its price per unit up 13.8 percent year-over-year to $480,769 in December, more than double the U.S. figure. By investment volume, Long Island was among the bottom-ranking metros with a volume of just $225 million.
Working with Yardi Matrix data, we first filtered out all metros with 2 million or more residents. Then, we decided on a series of significant data points that would separate the best-performing markets from the rest. We looked at the increases in the average per-unit price for transactions closed in 2023 through December compared to the same period of the previous year, at how the employment market performed year-over-year, as well as the number of units completed in 2023 and the number of apartments underway as of December. We then compared the markets based on the performance of these data points and eventually assigned them a final score.
