Headed into 2020, it’s fair to say no prognosticators foresaw a global pandemic and the impact it would have on gateway markets. At the same time, headed into 2021, few if any market participants would have foreseen the rapid upswing in the multifamily demand – led by gateways. Multi-family absorption in the U.S totaled 475,000 units year-to-date through September, and absorption topped 100,000 units four quarters in a row. Both represent unprecedented performance. 1
The drivers of demand coming out of the pandemic – including robust economic growth, the decline of unemployment, pent-up demand coming out of the pandemic, and strong household savings – are by now well known.
Recent signs that multifamily rent growth might slow down proved to be premature, as the average U.S. asking rent increased by $23 in October to a record high $1,572. In Nashville, the price-per unit rose 13.2%, while developers had 13,809 units underway through December. 2
The growth is driven by an ongoing surge in demand that started in spring and has yet to subside. The average U.S. occupancy rate of stabilized properties reached a record-high of 96.1% in September. 1
Music City Multifamily Trends:
- Several organizations announced further expansion in Nashville in 2020-2021, including roadside-assistance company Agero (900 jobs), QTC Management (410 jobs over the next five years), Ramsey Solutions (600 jobs and a new office building underway).
- The metro’s population has been on a steady upward trend over the past decade, marking a 16.9% increase since 2010.