Kansas City Multifamily Report – Summer 2020
The health crisis deeply impacted the metro's economy, but rentals proved resilient, bucking national trends.
Kansas City rent evolution, click to enlarge
The Kansas City multifamily market proved resilient during the second quarter of 2020. Amid consistent demand, the impact of the health crisis was relatively mild when compared to coastal and leisure-oriented metros; this difference helped maintain positive rent performance. The average Kansas City rent climbed 0.2 percent on a trailing three-month basis through June. In the meantime, the U.S. average slid 0.3 percent.
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Kansas City sales volume and number of properties sold, click to enlarge
Kansas City job growth turned negative in April, when stringent stay-at-home measures curtailed economic activity. As of May, employment had contracted by 105,900 positions on a year-over-year basis. Construction was the only sector to add jobs during the pandemic, with development deemed an essential service. In a few quick months, unemployment went from a tight 3.5 percent in March to 11.3 percent in April, before a slight rebound to 10.8 percent in May. While the metro’s economy was initially impacted less than many coastal cities, the evolution of the pandemic and the continued fluctuation in the number of coronavirus cases remain deciding factors.
Year-to-date through June, some 774 units were completed in the metro and another 7,700 apartments were underway. Following last year’s cycle high of $941 million in transactions, sales volume amounted to only $159 million in the first two quarters of 2020, marking a 63 percent drop compared to the same interval last year.
