Several months into the economic deceleration, the national pattern of lower-cost metros outperforming primary markets is becoming apparent in Kansas City. While the crisis has undeniably impacted the metro’s economy, Kansas City’s multifamily fundamentals have endured, with overall rents up 0.4 percent to $1,011 on a trailing three-month basis as of October, below the $1,464 national average.
In line with national trends, leisure and hospitality was the most impacted sector in the metro, down 21,800 positions in the 12 months ending in September. Job gains occurred in construction and government, with the sectors adding a combined 3,800 positions. According to a forecast from the Center for Economic Development and Business Research, employment is projected to gradually rebound for the remainder of the year and into 2021. Contingent on national patterns and the pandemic’s evolution, Kansas City is forecast to add 14,500 jobs through 2021, with leisure and hospitality expected to lead job gains.
As of October, 7,204 units were underway, with the bulk of those targeting high-income renters. Developers added 2,872 units to inventory year-to-date, accounting for 1.8 percent of existing stock. Some $471 million in assets traded in 2020 through October. While deal velocity slowed, investors continued to deploy capital, with a strong focus on the Renter-by-Necessity segment.