• Ellie Perlman

Top 10 Markets for Multifamily Real Estate Returns

As we continue to navigate through these recent economic changes, there’s been a multitude of speculation on what the impact will be on real estate investing. Granted, being a multifamily syndicator and investor myself, I am biased; yet, when it comes to real estate investing, multifamily continues to live up to its reputation of being one of the historically safest and most reliable asset classes there is.

According to the Newmark Knight Frank 1Q2020 US Multifamily Capital Markets Report, multifamily total returns averaged 5.10% in the last year. The key to capitalizing on this is selecting the strongest and highest performing markets. I personally focus on opportunities in Texas, Florida, and Georgia, where average returns can commonly range from 7%-9% or more. When a strategy for maximizing returns is effectively implemented, a multifamily investment can prove profitable even through economic shifts, as we are seeing in our current portfolio.

Which markets are leading the charge? Here are the top 10 markets in the last 12 months for returns on multifamily investments:

10. Seattle, WA

Overall Population: 637,850

Annual Total Return: 6.02%

Average 2 BR Rent: $1,690

Mean Income: $67,365

9. Palm Beach, FL

Overall Population: 8,344

Annual Total Return: 6.04%

Average 2 BR Rent: $1,418

Mean Income: $105,700

8. Minneapolis, MN

Overall Population: 394424

Annual Total Return: 6.70%

Average 2 BR Rent: $1,150

Mean Income: $50,767

7. Atlanta, GA

Overall Population: 440,641

Annual Total Return: 6.80%

Average 2 BR Rent: $1,190

Mean Income: $46,439

6. Denver, CO

Overall Population: 633,777

Annual Total Return: 7.73%

Average 2 BR Rent: $1,350

Mean Income: $51,800


5. Charlotte, NC

Overall Population: 774,807

Annual Total Return: 8.07%

Average 2 BR Rent: $1,140

Mean Income: $53,274

4. Tampa, FL

Overall Population: 348,934

Annual Total Return: 8.24%

Average 2 BR Rent: $1,280 Mean Income: $43,740

3. Orlando, FL

Overall Population: 250,224

Annual Total Return: 8.54%

Average 2 BR Rent: $1,280

Mean Income: $41,901

2. Austin, TX

Overall Population: $864,218

Annual Total Return: 8.69%

Average 2 BR Rent: $1,461

Mean Income: $55,216

1. Phoenix, AZ

Overall Population: 1,490,758

Annual Total Return: 13.73%

Average 2 BR Rent: $1,100

Mean Income: $46,881

Sources:

Newmark Knight Frank 1Q2020 US Multifamily Capital Markets Report

http://www.usa.com/

https://www.apartmentlist.com/

Want to Invest with Ellie?

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About the Author

Ellie is the founder of Blue Lake Capital, a real estate company specialized in multifamily investing throughout the United States. At Blue Lake Capital, Ellie helps investors grow their wealth and achieve double-digit returns by investing alongside her in exclusive multifamily deals they usually don't have access to.

Ellie is the host of REady2Scale , a podcast that focuses on the "APS" of real estate: Asset, Process, and Strategy. Each episode discusses how investors can scale their real estate portfolio and/or businesses.

She started her career as a commercial real estate lawyer, leading real estate transactions for one of Israel’s leading development companies. Later, as a property manager for Israel’s largest energy company, she oversaw properties worth over $100MM. Additionally, Ellie is an experienced entrepreneur who helped build and scale companies by improving their business operations.

Ellie holds a Masters in Law from Bar-Ilan University in Israel and an MBA from MIT Sloan School of Management.

You can read more about Blue Lake Capital at www.bluelake-capital.com and learn more about Ellie at www.ellieperlman.com.

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