Phoenix’s multifamily market posted an exceptional performance throughout 2021, with rents, supply and sales all marking new decade highs. Rents rose 25.9 percent on a year-over-year basis through November, to $1,607, surpassing the U.S. rate, which marked a 13.5 percent increase to $1,590. The occupancy rate in stabilized properties stood at 96.3 percent in October, following a 70-basispoint year-over-year increase.
The unemployment rate dropped to 3.2 percent in October, outperforming the 4.6 percent national figure. Arizona was one of the few metros that had made a full employment recovery less than a year and a half into the pandemic, with the job market posting a 7.0 percent expansion in the 12 months ending in September 2021, leading the U.S. rate by 60 basis points. Phoenix added 126,500 jobs during the period, despite the financial services sector’s 3.2 percent contraction. Leisure and hospitality led gains (34,900 jobs), followed by trade, transportation and utilities and professional and business services, which accounted for 55,500 jobs combined.
Developers delivered 9,479 units in 2021 through November—a new decade high—and had another 36,080 units under construction. Meanwhile, investment activity rose by 31 percent over the previous peak, totaling 10.6 billion in multifamily assets as of November, for a per-unit price that increased to $245,253.