Today’s Daily Data Discussion post will look at markets around the country with high multifamily rental rate growth. 

Why think about multifamily rental rate growth? 

For the multifamily investor seeking emerging or recovering markets in which to invest, the ideal market is one in which market rent rates have been stagnant for some time.  We like to look for markets that have had recent rental rate growth of less than 2%.  The objective is of course to identify these markets before they tighten and drive rental rates up.  Increased rental rates translate to increased NOI which translates to a) greater income for the investor, and b) greater value of the asset. 

Of interest, the more research we do, the more we find this particular value is a tough one to pin down in a market.  Said another way, ask 10 brokers and property managers in Dallas about this value today, and they’ll most likely give you 10 different (but most often close) values.   Research and diligence provide the best answers.

Here are the markets in our database as of today with the highest multifamily rental rate growth values –

1. Salem, OR (5.6%)
2. Spokane, WA (5.5%)
3. Tulsa, OK (5%)
4. Philadelphia, PA (4.7%)
5. Salt Lake City, UT (4.5%)

Tomorrow we’ll take a look at the lowest multifamily rental rate growth in markets around the country. 

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