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Top 5 Western Markets by Multifamily Investment Volume

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The national multifamily investment volume continued to break records, crossing $157 billion through the first three quarters of 2022. That’s higher than the best year on record yet—2021, when $132 billion in multifamily assets had changed hands across the U.S. through the same interval. However, this remarkable performance in investment is about to take a break following the Fed’s repeated actions to stop inflation.

We pulled up the top five western markets by investment volume through September, using data provided by Yardi Matrix. Combined, the metros in this ranking—Phoenix, Denver, Las Vegas, Tucson, Ariz., and Salt Lake City—accounted for $21 billion in sales, narrowly outperforming last year’s $20.7 billion. Some key takeaways are:

  • Sales volume was lower than last year in just one of the Western markets.
  • All markets saw increases in per-unit prices.
  • Fewer properties/units traded this year through September than during the same interval in 2021.
  • Investors focused on Lifestyle units ($11.5 billion), but volume was below last year’s ($12.2 billion); this year’s Renter-by-Necessity volume ($9.7 billion) was below that of the Lifestyle segment but actually outpaced last year ($8.4 billion).
  • RBN sales volume was behind that of last year’s in one of the markets.
  • Lifestyle sales volume surpassed that of last year’s in two markets.

Here are the top western markets by transaction volume through September:

Market Sales Volume $ 2022 Price per Unit 2022 PPU Growth Rate Assets Sold 2022 Units Sold 2022
Phoenix $9,727,714,167 $331,914.87 35.8% 164           32,421
Denver $4,099,448,000 $331,811.27 6.1% 70              14,418
Las Vegas $2,748,240,000 $262,211.62 34.7% 50             11,025
Tucson $1,123,113,142 $173,507.36 23.1% 33                6,473
Salt Lake City $869,505,586 $253,605.89 16.2% 30               4,423
Top Western Markets by Investment Volume, Yardi Matrix Data

1. Phoenix

Phoenix’s allure materialized into a multifamily investment volume in excess of $9.7 billion through September, a 4.2 percent increase over the $9.3 billion that traded during the same interval last year. The number of properties that changed hands dipped from 194 (38,831 units) in 2021 to 164 (32,421 units) this year. However, solid appetite pushed the per-unit price up by 35.8 percent year-over-year, to $331,915, marking the highest increase among the western markets, as well as the highest overall average asking price.

The price per unit increase is even more spectacular when looking at the sales composition: 61 Lifestyle properties totaling 13,751 units, and 103 RBN properties totaling 18,670 units. Overall, the Lifestyle sales volume through September was slightly above $5.2 billion, just shy of the nearly $5.4 billion volume registered by the segment last year. Meanwhile, the RBN sales volume amounted to $4.5 billion, surpassing last year’s figure of $4 billion through September.

2. Denver

Denver is the only market in our ranking to post a lower multifamily sales volume in 2022 than last year. Specifically, this year through September, investors traded $4.1 million in multifamily assets, a 25.4 percent decrease from the $5.5 billion volume recorded last year. Not only did the number of sold assets drop from 84 properties (19,087 units) last year, to 70 properties (14,418 units) this year, but the per-unit price marked the weakest performance among the markets in this list, rising just 6.1 percent year-over-year, to $331,811. Still, at this value, it is just slightly below Phoenix’s average, making Denver the second-most expensive metro on this list.

The sales composition shows that while the number of sold Lifestyle assets dropped considerably from last year (to 27 properties totaling 5,654 units from 47 properties totaling 12,421 units), the volume of RBN assets increased slightly (to 43 properties totaling 8,764 units from 37 properties totaling 6,666 units). Consequently, the Lifestyle volume was slashed to just $2.3 billion this year, from $4.1 billion last year, while RBN sales volume rose to nearly $1.8 billion this September from $1.4 billion in 2021.

Chart created using Yardi Matrix Data

3. Las Vegas

Rounding out the top three, Las Vegas multifamily investment volume totaled $2.7 billion in September, up 14.1 percent from the $2.4 billion registered during the first three quarters of 2021. Fewer properties traded than in 2021—50 properties totaling 11,025 units, compared to 57 properties comprising 12,373 units—but the investor competition compensated and the price per unit rose by a hefty 34.7 percent year-over-year, to $262,212 in September, the second largest increase in this ranking and behind only Phoenix.

By sales composition, investor interest was fairly balanced across the quality spectrum, with 22 Lifestyle sales totaling 5,000 units and 28 RBN sales (6,025 units). Lifestyle investment volume rose to nearly $1.7 billion (above the $1.4 billion registered last year through September), while RBN investment volume marked an increase to $1.1 billion from $986 million during the same period last year.

4. Tucson

The last metro in this ranking to exceed the $1 billion mark in multifamily sales volume was Tucson. The metro recorded $1.1 billion, posting a remarkable 48 percent jump from last year’s total of $759 million. This record volume was attained through the sale of 6,473 units, above the 5,544 units sold during the same interval last year. In addition, the price per unit rose 23.1 percent year-over-year, to $173,507, which makes it the most affordable market in this ranking.

The dire investor competition drove up prices, as just one 154-unit upscale asset changed hands in the metro through September, for $93 million. The remaining $1 billion resulted from the sale of working-class RBN assets, nearly double the $537 million volume registered during the same period last year.

Chart created using Yardi Matrix data

5. Salt Lake City

Salt Lake City closes our top five with a multifamily investment volume of $870 million through September, a 40.2 percent improvement from the $620 million total recorded through September 2021. Although the total was higher than last year’s, the volume of assets that traded remained unchanged (4,400 units). The price per unit rose a solid 16.2 percent year-over-year, to $253,606 in September, not far below Las Vegas’ rate.

One-third of the properties that traded comprised Lifestyle assets (1,962 units, nearly twice the 1,091 Lifestyle units sold in 2021 through September) and totaled $466 million, well above the $179 million in 2021. The other two-thirds were RBN properties (2,461 units, less than the 3,321 RBN units sold in 2021 through September), for a total of $404 million, slightly below the $441 million the prior year.

Yardi Matrix covers all multifamily properties of 50-plus units across 140 markets in the United States. This ranking reflects transactions within that sample group.



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