Top Cities to Invest in Multifamily Properties in 2024

The multifamily sector is facing challenges similar to other commercial properties, such as increased mortgage rates affecting values and refinancing, escalating costs, and potential dips in demand due to economic downturns. However, the long-term outlook remains positive due to consistent demand drivers. Despite a post-pandemic slowdown, absorption remains robust, and occupancy rates are still high compared to historical averages.

For those considering apartment investments, we’ve compiled a list of the top 10 cities for multifamily property investments in 2024, based on PwC’s Emerging Trends in Real Estate report and other supplemental data. These cities offer strong economic fundamentals, growing populations, and favorable real estate conditions.

10 Best Cities for Multifamily Property Investments in 2024

Each city’s market outlook and investment opportunities are detailed below. Demographic information is sourced from CensusReporter.org and DataUSA.io, while rental and occupancy data are from Zumper.com for 2-bedroom units, unless otherwise noted.

1. Jersey City, NJ

Jersey City, across the Hudson River from Manhattan, has a robust rental market due to its strategic location and diverse population. With 70% of housing units renter-occupied, median rents for a 2-bedroom unit are $3,950 per month. The city’s growth and development initiatives ensure a steady influx of residents.

Jersey City Multifamily Trends

• For Sale (active): Median price: $1.23 million, Price/SqFt: $277, Price/Unit: $268,000, Asking cap rate: 6.0%
• Sales Comps: Median price: $660,000, Price/SqFt: $283, Price/Unit: $300,000

2. Madison, WI

Madison, a vibrant college town and state capital, is home to the University of Wisconsin-Madison, significantly contributing to the local rental market. The city’s population has grown by 17% since 2010. Median rents for a 2-bedroom unit are $1,675 per month.

Madison Multifamily Trends

• For Sale (active): Median price: $2.6 million, Price/SqFt: $150, Asking cap rate: 7.3%
• Sales Comps: Median price: $425,000, Price/SqFt: $124, Price/Unit: $209,000

3. Columbus, OH

Columbus, Ohio’s capital, offers diverse employment opportunities and a cost of living 10% lower than the national average. The population has increased by 1% over the past year, and median household incomes have risen by 6.7%. Median rents for a 2-bedroom apartment are $1,379 monthly.

Columbus Multifamily Trends

• For Sale (active): Median price: $489,000, Price/SqFt: $158, Price/Unit: $148,000, Asking cap rate: 5.6%
• Sales Comps: Median price: $284,000, Price/SqFt: $114, Price/Unit: $120,000

4. Knoxville, TN

Knoxville’s diversified economy and steady population growth create a stable foundation for multifamily investors. The city’s median rents are $1,590 per month for a 2-bedroom apartment, with over 50% of households renter-occupied.

Knoxville Multifamily Trends

• For Sale (active): Median price: $2.39 million, Price/SqFt: $226, Price/Unit: $160,000, Asking cap rate: 6.0%
• Sales Comps: Median price: $482,000, Price/SqFt: $356, Price/Unit: $15,100

5. Pittsburgh, PA

Pittsburgh’s economy focuses on services, medicine, higher education, tourism, and banking. The city has seen significant job growth and a decrease in unemployment to 3.0%. Median rents for a 2-bedroom unit are $1,456 per month.

Pittsburgh Multifamily Trends

• For Sale (active): Median price: $425,000, Price/SqFt: $159, Price/Unit: $109,000, Asking cap rate: 6.7%
• Sales Comps: Median price: $235,000, Price/SqFt: $98, Price/Unit: $105,000

6. Louisville, KY

Louisville’s multifamily market is bolstered by strong job growth in construction and manufacturing. The median rents for a 2-bedroom unit are $1,160 per month, with a significant portion of residents holding a bachelor’s degree or higher.

Louisville Multifamily Trends

• For Sale (active): Median price: $999,000, Price/SqFt: $116, Price/Unit: $95,400, Asking cap rate: 6.0%
• Sales Comps: Median price: $299,000, Price/SqFt: $94, Price/Unit: $78,100

7. New York, NY (Brooklyn)

New York City, particularly Brooklyn, is a robust market for multifamily investments due to high demand for housing and stable market conditions. Rents have increased 12% year-over-year, with median rents for 2-bedroom units at $4,995 per month.

Brooklyn Multifamily Trends

• For Sale (active): Median price: $2.56 million, Price/SqFt: $490, Price/Unit: $391,000, Asking cap rate: 5.9%
• Sales Comps: Median price: $807,000, Price/SqFt: $376, Price/Unit: $180,000

8. West Palm Beach, FL

West Palm Beach offers a thriving multifamily market supported by population growth and favorable weather conditions. Median rents for 2-bedroom units are nearly $2,300 monthly.

West Palm Beach Multifamily Trends

• For Sale (active): Median price: $1.35 million, Price/SqFt: $360, Price/Unit: $375,000, Asking cap rate: 5.7%
• Sales Comps: Median price: $545,000, Price/SqFt: $216, Price/Unit: $405,000

9. Raleigh/Durham, NC

Raleigh/Durham, known for its research triangle, has seen significant population and job growth, with median rents for multifamily homes over $1,560 monthly. Nearly 50% of housing units are renter-occupied.

Raleigh/Durham Multifamily Trends

• For Sale (active): Median price: $2.24 million, Price/SqFt: $287, Price/Unit: $280,000, Asking cap rate: 4.1%
• Sales Comps: Median price: $600,000, Price/SqFt: $227, Price/Unit: $213,000

10. Oklahoma City, OK

Oklahoma City’s multifamily market benefits from continuous population growth and high quality of life. Median rents for a 2-bedroom place are $1,050 per month, making it an attractive investment for steady returns.

Oklahoma City Multifamily Trends

• For Sale (active): Median price: $1.67 million, Price/SqFt: $166, Price/Unit: $125,000, Asking cap rate: 6.4%
• Sales Comps: Median price: $225,000, Price/SqFt: $112, Price/Unit: $131,000

Conclusion

Investing in multifamily properties in 2024 presents numerous opportunities across various U.S. cities. Each market offers unique advantages, such as strategic locations, robust infrastructure, and growing populations. For businesses looking to maximize their investments in multifamily real estate, these cities provide a promising landscape.

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