Top Markets for Multifamily Transactions in 2022

March 22, 2023

Listicles Atlanta Dallas FeaturedMoreFinance & Investment National Phoenix Southeast Southwest

These cities accounted for 40 percent of the annual investment activity, according to Yardi Matrix data.

Image by GregoryButler via Pixabay

Multifamily investment powered through mounting economic challenges in 2022, with the national sales volume slightly above $200 billion, which is 14.4 percent lower than 2021’s total, according to Yardi Matrix data. The average U.S. price per unit continued to increase (up 11.2 percent year-over-year to $212,181) and the sales composition—heavier on the Renter-by-Necessity side with 57 percent of all units sold in the segment—shows a keener interest for value-add opportunities.

Despite the slight dip in national sales volume, their combined totals remained unchanged, accounting for 40 percent of the national sales, in both 2021 ($96 billion) and 2022 ($80 billion).

Multifamily sales volumes declined in seven of the top 10 markets, up only in Los Angeles, Orlando and New York—the latter posted a strong rebound, up more than 200 percent compared to 2021 levels, and is also the only metro where the number of units sold increased from the previous year. In addition, these three markets are the only ones with increases in the volume of upscale Lifestyle assets that traded in 2022. Meanwhile, the sales volume registered in the RBN segment was up in all but two metros—Charlotte and Los Angeles. Here are the top 10 U.S. multifamily markets by investment volume in 2022.

Metro	Sales Volume $2022	Price Per Unit 2022	Assets Sold 2022	Units Sold 2022
NATIONAL	$200,240,131,245	$212,181	5,946	1,144,213

Atlanta	$11,964,229,394	$205,788.42	275	62,167
Phoenix	$11,306,035,129	$322,582.62	201	39,691
Dallas	$10,284,900,277	$174,147.76	497	107,430
Houston	$9,887,173,638	$152,435.73	381	96,354
Miami	$6,673,451,883	$325,575.83	114	22,599
Orlando	$6,453,854,031	$242,914.18	112	28,590
Los Angeles	$6,359,607,395	$437,496.65	99	13,477
Washington, D.C.	$6,271,248,445	$276,764.86	103	25,223
New York	$6,034,606,218	$626,998.92	51	7,657
Charlotte	$5,263,281,111	$248,778.04	106	21,088

1. Atlanta

Atlanta topped the ranking with nearly $12 billion in multifamily sales, down from $16.3 billion in 2021. More than $4.4 billion of last year’s sales volume traded in the working-class, RBN quality segment. Although trending down, the metro’s investment market was still highly active, outranking its pre-pandemic peak registered in 2019 ($7.9 billion).

The decline in transactions was caused by a significant drop in the sale of upscale assets, a 35 percent decline from 2021’s $11.8 billion total. Meanwhile, the RBN sale volume posted a slight increase last year, from $4.3 billion in 2021. By number of properties and units sold, Atlanta was third among these 10 markets, with 62,167 units in 372 properties, behind two other steady metros—Dallas and Houston.

For now, the average price per unit maintained steady growth, up 8.6 percent year-over-year to $205,788, narrowing the gap with the U.S. average. For Lifestyle assets, the per-unit price rose 13.6 percent to $259,582, while for RBN units shot up 18.9 percent to $154,310.

2. Phoenix

Phoenix maintained a strong presence in the investment market although its sales volume dropped 25 percent compared to 2021, to $11.3 billion. Mirroring Atlanta’s trend, the metro’s decline in volume occurred only in the Lifestyle segment, from $8.3 billion in 2021 to $6.2 billion in 2022. In addition, RBN volumes not only rose from $5.1 billion to $6.7 billion but also surpassed Lifestyle sales. By the number of properties and units sold, Phoenix was right behind Atlanta, with 39,691 units in 276 properties.

Increased competition among investors helped the price per unit rise by a substantial 25 percent to $322,583, behind only Miami (35 percent), and well ahead the U.S. national average. Investor preference for value-add plays pushed up the RBN per-unit price by nearly 28 percent to $260,773, and for Lifestyle assets by 23 percent to $406,862.

Price per Unit Evolution 2021 – 2022. Chart created using Yardi Matrix data

3. Dallas

With an investment volume on a decelerating trend for several years, Dallas’ total dropped by yet another 33 percent, losing its top position, but still posting a strong sales total, with $10.3 billion. It was the third and last market with an annual multifamily investment value in the double digits.

It was also the third market in this ranking with declines in Lifestyle sales and increases in the RBN trades. Specifically, sales of Lifestyle assets dropped from $10 billion to $5.4 billion in 2022, and those of working-class properties increased from $4.9 billion to $5.3 billion. Compared with 2021, more properties (577) and fewer units (107,430) changed ownership in Dallas—148,004 units in 497 properties traded in 2021).

Growth in property values was driven by an 18.6 percent increase in the average price for Lifestyle units, to $222,804, double the 9.4 percent RBN rate that clocked in at $143,710. Overall, the average price per unit in the metro rose 7.2 percent to $174,148, trailing the national average.

4. Houston

Houston’s annual multifamily sales volume also decreased in 2022, but only by 12 percent, just below $10 billion to $9.9 billion (from $11.2 billion in 2021). The metro ranked fourth in 2021, too, behind the same three metros—Atlanta, Phoenix and Dallas.

Unlike the higher-ranking metros, sales volumes declined across asset classes, to $6.6 billion in Lifestyle trades (from $7.7 billion in 2021) and to $3.3 billion in RBN transactions (from $3.5 billion). By the number of properties and units sold, Houston ranked second, trailing Dallas, with 96,354 units in 443 properties.

The overall average price per unit in Houston rose 6.2 percent in 2022, to $152,436, but remains in the relatively affordable pool, being well below the $212,181 U.S. average.

Multifamily sales by asset class 2021 - 2022

Sales Volume by Asset Class 2021 – 2022. Chart created using Yardi Matrix data

5. Miami

The Florida metro inched up one position since the 2021 ranking. Multifamily investment volume declined in Miami as well, to nearly $6.7 billion from $9.3 billion in 2021.

Similar to the top three ranking markets in this ranking, in Miami Lifestyle sales volumes decreased, to $5.4 billion from $7.2 billion in 2021, while the pressing demand for value-add opportunities pushed up RBN volumes, to $2.7 billion from $1.2 billion in 2021. The number of units sold in 2022 (22,599 units) dropped to less than half the volume registered in the prior year (46,442 units), and the number of properties slid to 114 from 200 in 2021.

Implicitly, the average price per unit rose by a hefty 47 percent to $213,592, which also marks the highest increase in property value among the metros in this ranking. In addition, the average per unit price for Lifestyle assets in Miami rose 17.2 percent to $385,456. Overall, the average price per unit in Miami rose by a substantial 35.1 percent to $325,576, well ahead of the national rate.

6. Orlando

Orlando gained two positions over the 2021 ranking, with multifamily investment volume increasing by nearly 10 percent, to $6.5 billion (from $6 billion in 2021). The metro is one of the three markets in this ranking with increases in sales volume.

By asset class sales, volumes increased across property segments, with the Lifestyle volume up to nearly $5.2 billion ($4.6 billion in 2021), and RBN rose to $1.4 billion ($1.3 billion in 2021). Furthermore, the number of properties that traded last year dropped to 112, totaling 28,590 units.

Growth in per-unit prices was recorded in both property segments, higher in RBN—up 19.7 percent to $161,291—and by 13 percent to $283,595 for Lifestyle assets. Overall, the average price per unit in Orlando rose 16.8 percent to $242,914, outpacing the national average.

multifamily sales by number of properties

Sales by Number of Properties. Chart created using Yardi Matrix data

7. Los Angeles

The second market in this ranking with a higher sales volume than in 2021, Los Angeles multifamily investment amounted to $6.4 billion last year In 2022, its highest mark in 10 years.

Lifestyle sales recorded in 2022 generated $3.7 billion, above 2021’s $3 billion, and RBN sales surpassed $2.6 billion, above the $2.4 billion registered in 2021. Moreover, 99 properties totaling 13,477 units were traded last year, slightly fewer than the previous year—106 properties, 16,150 units.

The average price per unit surpassed the $400,000 mark for the first time ever, up 16 percent year-over-year, to $437,497, double the U.S. average. Growth was stronger in the Lifestyle segment, posting a 25.3 percent increase to $590,903, the highest increase in the segment among the markets in this ranking. Meanwhile, the average per-unit price in the RBN component rose 10.6 percent to $339,168.

8. Washington, D.C.

With nearly $6.3 billion in multifamily sales, Washington, D.C., dropped a position from the 2021 ranking, when the transaction volume stood at $9.4 billion. However, this amount is still above the 2020 volume ($6.1 billion) and not too far below the $6.6 billion recorded in 2019.

Sales declined in both property segments, with Lifestyle transactions accounting for $4.2 billion of the overall total, and RBN trades generating $2.1 billion. In 2021, Lifestyle sales totaled $5.1 billion and RBN transactions reached $4.2 billion. In 2022, 103 properties with 25,223 units changed ownership, fewer than in 2021—126 properties, 37,406 units.

The average price per unit inched up just 2.5 percent in 2022, to $276,765, leading the national figure. Behind this small increase is the 12.2 percent drop in RBN’s average price per unit to $212,416, while the average Lifestyle unit increased by 9.9 percent to $300,089.

Sales by Number of Units. Chart created using Yardi Matrix data

9. New York

New York’s performance on the multifamily investment front was remarkable in 2022, amounting to $6 billion, triple the volume recorded in 2021. It is also one of the three markets in this ranking that posted increases in multifamily sales.

Sales of Lifestyle assets increased more than fivefold, to nearly $5 billion, while RBN transactions generated nearly $1.1 billion, almost on par with 2021’s volume. New York is the only market where deal volume shot up, accounting for 51 trade properties totaling 7,657 units.

New York is the only market in this ranking where the average price per unit dropped in 2022, by 2.1 percent to $626,999. This depreciation was driven by a massive 44.6 percent decrease in the RBN’s per-unit price, to $334,056, while Lifestyle units increased on average by 12.1 percent to $850,479.

10. Charlotte

Charlotte rounded up the top 10 with $5.3 billion in multifamily sales, nearly on par with the volume registered in 2021. Overall, investment activity was intense, with 2022 being the second-best year for transaction volume in the past decade.

Investor interest was heavily geared toward Lifestyle assets, accounting for $4.3 billion of the year’s total; RBN sales reached $944 million. Furthermore, 106 properties with 21,088 units traded in Charlotte in 2022, slightly below the volume in 2021 when 121 properties totaling 22,890 units changed hands.

The average price per unit in the metro gained 12.2 percent to $248,778, outperforming the $212,181 national figure. Price increases in the RBN segment amounted to 30.1 percent to $167,819, marking the second-largest gain, behind Miami. The average per-unit price for Lifestyle apartments rose 10.1 percent to $281,627.