Best Multifamily Markets Right Now

This list will self-destruct. Why? Because no market is a “good” market forever. Cities come and
go … they boom and decline. Today’s best city for multifamily investment could be next year’s
worst. But every year it pays to take stock of which cities are most worthy of our attention.

They say real estate is about “location, location, location.” That couldn’t possibly be more true
for multifamily investing — especially in a challenging economy. Everyone else could be
hemorrhaging money … but pick the right market, the one city out of dozens that happens to be
experiencing a boom amid the bust, and you can keep growing your wealth under any economic
conditions.

If that sounds like a goal worth pursuing, let’s talk about the best multifamily markets out there
right now — places where we are putting our money, and where you should consider putting
your money.

What Makes a Market “Good” For Multifamily?

Before I share my picks for the best multifamily markets right now, let’s remind ourselves what
makes a market “good” in the first place. My picks aren’t wild guesses — there are certain
hallmarks of a high-performing multifamily market.

Does a market need to have all of these characteristics to make the “hot list?” Absolutely not.
But the more of them they have, the better.

Population Growth
This may be the most important criteria of all. Multifamily real estate investing is all about where
people live. Well, do people even want to live in this market? The best indication of a “yes”
answer is if people are moving into the market instead of out.

Strong population growth in a given area can indicate a growing demand for rental properties,
particularly in urban areas. A growing population also means a growing workforce, which can
increase demand for affordable housing.

Job Growth
Job growth usually goes hand-in-hand with population growth. Those new residents need to
earn a living somehow, and people tend to move house when they see an opportunity to
improve their financial station.

That’s why we look for new campuses and plants, companies relocating and adding jobs to a
market. When job growth is strong, it can lead to an increase in demand for rental properties as
more people move to the area to work. This can also lead to higher rents and lower vacancy
rates.

Low Vacancy Rates

A low vacancy rate indicates that there is a high demand for rental properties in the area. It’s
also an indication that the area is not yet overbuilt. You could have strong population growth …
but also more housing than you need for the in-migration.

This tends to happen when a market gets hot — developers scramble to build as many housing
units as possible … only to discover they have built too many. So buildings sit vacant, and
prices depress. No bueno. Low vacancy rates are a much better sign.

High Rental Rates

High rental rates can be a good sign for multifamily real estate investors, as it indicates that the
market can support higher rents and potentially higher returns on investment. Remember, the
jobs have to be there to support those higher rents, and the market can’t be overbuilt, or the
oversupply will put downward pressure on those rents.

Landlord-Friendly Laws
A market is considered "landlord-friendly" when the laws and regulations in that area provide
more protection and advantages to landlords than to tenants. The law tends to favor landlords
over tenants in these jurisdictions and has favorable eviction laws, making it easier to get rid of
a bad tenant quickly.

Low Property Taxes

Lower property taxes can make it more profitable for landlords to own and operate rental
properties in a particular market.

Favorable Regulatory Environment

Some markets have regulations that are more favorable to multifamily real estate investors. This
can make investing in these properties more attractive. For example, laws that provide tax
incentives or other benefits to investors can make it more profitable to invest in rental properties.

Strong Economic Fundamentals

A strong economy, low unemployment rates, and high consumer confidence can all contribute
to a strong rental market and make multifamily real estate investing a low-risk bet in that area.

Another key indicator to look for is a diverse economy. A market could have strong job growth,
but if only one industry or employer furnishes those jobs, that economy is dangerously
vulnerable. A downturn in that industry could tank the whole shebang.
Low Crime Rates
You can’t charge premium rents on a property located in a war zone, no matter how nicely you
renovate the bathrooms. Properties located in areas with low crime rates are generally more
attractive to renters, which can lead to lower vacancy rates and higher rents.

Best Multifamily Markets for 2023

Okay, now we have an idea of what success looks like … let’s pick some horses!

Atlanta, GA
Atlanta may be my favorite market for multifamily real estate right now. Estimates put its growth
at 50% over the last 20 years. Think about that. And it shows no signs of slowing down — the
Atlanta metro grew by nearly 180 new residents per day last year.

The economic base is strong and diverse – finance, tech, healthcare. The biggest names in tech
are opening up in Atlanta, including Apple, Alphabet, and Microsoft. These companies do their
homework. They aren’t climbing on board a sinking ship. And the jobs they bring ensure that
while people might complain about the rising rents, they have the income to support them.

While the boom has put upward pressure on rent (good for landlords), the cost of living remains
right smack-dab in the middle for the US, making it a comparatively affordable city. The hunger
for affordable infill housing is massive, especially among the influx of young professionals
flocking to the tech jobs and eager to live in urban centers instead of suburbs.

You just can’t break the Atlanta MSA. It’s one of the biggest no-brainers in the country right
now.

Charlotte, NC
Make no mistake — Charlotte is growing because it wants to grow. It’s the US city that has
gotten out of its own way. Charlotte is actively incentivizing companies to move there.

As a result, it’s now pound-for-pound home to way more Fortune 500 companies than you
would expect it to rate, including Bank of America, Lowe's, and Duke Energy. Want to have
some fun with your bills (if that’s even possible)? Check your mail and see how many of the bills
you pay have PO Boxes in Charlotte as their mailing addresses.

In addition to incentivizing job growth, Charlotte incentivizes the development of rental housing
for those new workers to live in. You would be hard-pressed to find a city that offers more
incentives for multifamily real estate developers, including tax incentives for substantial
rehabilitation of affordable housing in designated areas. It also offers fast-track permit approval,
urban density bonuses, and low-interest loans for affordable housing development. Yes please.
If that’s not enough to punch your card, look no further than the high rental rates and low
vacancy rates. The proof is in the pudding — Charlotte is a winner.

Austin, TX
Yes, it’s been on the radar for years, but Austin just keeps growing like a weed. At last count,
116 people were moving in per day. Construction cranes are practically a permanent fixture of
the skyline, but they still can’t build highrises fast enough.

Good places rent as fast as they come available, causing prices to skyrocket. But with Tesla
and Amazon moving in, Apple and Meta expanding their already large footprint, the incomes are
there to support them. It’s just a cool city with tons to do, lots of outdoor areas, and generally
high quality of life. The Circuit Of The Americas racetrack has become a hub of global tourism
for Formula One racing and national touring acts.

The suburbs feature good schools and minimal crime. Popular festivals and expos like SXSW
and ACL are just the start. People just can’t get enough of Austin, pouring in from all over the
country and the world.

Austin suffers from higher-than-average property taxes, but Texas also enjoys the distinction of
being one of the most landlord-friendly states in the US. Eviction laws skew to the landlord, and
the state has a history of defending property rights.

Houston, TX
Austin gets all the ink, but don’t count out Houston. The fourth-largest city in the country,
Houston is best known for its oil and gas industry, leading many people to think its economy
lacks diversity. Not true. Energy accounts for less than 19% of Houston’s economy — well
within acceptable ranges. Even if the energy economy falters, Houston isn’t going anywhere.

As one of the largest ports in the US, Houston is a crucial hub of imports and exports. It also
leads the world in aerospace. (Don’t forget — “Houston, we have a problem.”) Strength in the
healthcare and biomedical industry make Houston competitive.

Houston benefits from the same landlord-friendly state laws as Austin, but it wins on an
affordable cost-of-living, which is particularly good for multifamily investing. You have to be
targeted with your strategy to avoid high-crime areas, but I would put Class-B Houston
multifamily shoulder-to-shoulder with any multifamily property in the country.

Columbia, SC
It pays to look off the beaten path. Your Austins and your Charlottes — they make headlines,
and for good reason. Columbia, SC? Not so much.

That’s not a bad thing. Fewer headlines means less competition. Columbia may be the best-
kept secret in the Investor Boardroom toolkit. The capital of South Carolina and also home of
the University of South Carolina, it enjoys a strong and diverse economy stabilized by evergreen
industries like government, healthcare, and education.

Stability is the name of the game here. Columbia is the tortoise that beats the hare. Property
values have marched up like clockwork in step with the growing population, with little of the
heady volatility that more storied real estate markets are susceptible to. I can’t even remember
the last time I saw a spike in vacancy here, and developers tend to keep their heads so you’re
unlikely to see one.

South Carolina also enjoys low property taxes and some of the most aggressive eviction laws in
the country — meaning deadbeat tenants are easy to turn out.

Las Vegas, NV
I know, I know … you think I just want to get sent on this business trip. “Fact-finding” at the
Wynn. Trust me, I’ve heard all the jokes and made some of my own. But hear me out.

Here’s the thing about Vegas, though … not only has it grown explosively despite a relatively
low cost of living (off the Strip, that is), but the economy is finally showing signs of diversity after
decades of dominance by the glittering lights of the entertainment, tourism, and gambling
industries. Healthcare, finance, and tech companies are starting to take Las Vegas seriously,
and jobs that don’t require a tuxedo, a showgirl outfit, or a smooth dealing hand are starting to
take over.

This has quietly become one of the strongest rental markets in the country — steady growth,
low vacancy. Add to that some of the most landlord-friendly laws in the country, and you have a
winner with room to grow.

Orlando, FL
Who doesn’t love Orlando? Mickey Mouse country happens to sit on some of the most landlord-
friendly turf in the United States, with only three days’ notice required to evict and only 15 days’
notice required to terminate a lease.

The city also enjoys enviable weather and high quality-of-life all year round. The economy isn’t
dependent on Disney either — healthcare and technology provide Orlando with some real
economic legs, as does its position smack in the middle of the state at a crossroads between
other thriving metros, like Tampa, Daytona Beach, and Miami.

Orlando is also notable for its young population. With a median age of 35, you’re going to have
a lot more renters in this exploding population as young professionals continue to flock to
Orlando.

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Now then … a property isn’t a good investment just because it’s in a good market. A good
market certainly helps, but the success or failure of a deal ultimately comes down to the
fundamentals of the deal itself. Equally so, it’s totally possible to find a screaming deal in a low-
growth, landlord-unfriendly jurisdiction many states away from these markets.

But as investors, we deal in probabilities. And these are the markets in 2023 where the
probabilities are excellent. Expect to hear more about them from us.