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Best Cities for Multifamily Real Estate

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Hotspots for Multi-Family Investments: Exploring the Best Buying Locations

In this piece, we review the best cities for multifamily real estate in 2023 across America. You’ll also find the benefits of investing in multifamily homes over single units and information on how to begin multifamily estate investing. Some of the most vibrant markets include Nashville, TN.; Columbus, OH; and Durham and Raleigh in North Carolina.

Why Invest in Multi-Family Homes for Sale

Multifamily properties are one of the most reliable sources of passive income in the real estate industry. You might consider them too much work to maintain or think they’re beyond budget, compared to single-family homes, if you’re new to the industry. However, multifamily real estate investments have several benefits for both new and experienced investors:

  1. Multifamily properties allow investors to grow their real estate portfolio quickly. Investors can own several rental units at once rather than buying them individually.
  2. Owning a multi-family home property poses less risk to the investors. Investors can keep receiving rent, even when one unit is vacant.
  3. It’s easier to manage multifamily rental properties as all units are in one location. Travelling and administrative costs (such as professional manager’s fees and taxes) are lower in multifamily homes.
  4. Investors have a wide range of properties to choose from: duplexes, triplexes, quadruplexes, and condo complexes. They can select from a wide range of property sizes, types, locations, and costs.

Any of the above reasons to invest in the best multifamily markets should motivate new and existing investors to consider them. However, there are a few things to note when considering multifamily properties post-recession.

What Are the Things to Know Before Investing in Multi-Family Properties in 2023?

Thankfully, less expensive, less-than-pristine or way-older multifamily properties maintain low vacancy rates and modest rent growth. Nevertheless, some multifamily portfolios will not likely recover until 2023. 

If you are trying to figure out how to get started in multifamily estates, here are a few things to note:

  • As more people work remotely, the demand for outdoor living spaces will increase.
  • Decreasing interest in public transit and urban living drives demand for multifamily properties in smaller cities and suburban areas.
  • Tourism, hospitality, and rental-heavily-dependent cities might not immediately recover.
  • The availability of jobs and income levels.

While the pandemic comes under control, the economic crisis and inflation come. Therefore, multifamily deals won’t become active until 2023 at the earliest. The same trend is expected for potential foreign buyers in the US real estate market.

Best Cities for Real Estate Investment in 2023

A property

As markets spring back from the recession, the following are the best places to invest in multifamily real estate in 2023. We’ve listed them in descending order of buy ratings due to current performance and long-term economic basics. If you’re seeking to grow your real estate portfolio, you might want to check out these markets.

10. Columbus

With about 877,436 housing units, the average rent of $985 keeps increasing above the national average at 4%. Its expanding 2.1 million-plus population and other favorable demographics place Columbus among the best Midwest markets.

9. San Antonio

Despite the adverse impacts of the recession, San Antonio apartment markets shine with stable rent increases above the national average. Its 772,512 housing units are 35% renter-occupied and there is a 6.2% vacancy rate. San Antonio’s 2022 average rent of $1,281 sits well within most household’s $60,075 in annual earnings.

8. Charlotte

Charlotte’s real estate market is undoubtedly one of the best places to invest in multifamily dwellings in 2022. Its rising population (1.58% per annum) due to an abundance of job opportunities and affordable housing has created a solid market. The average rent of $1,276 with 2% annual growth is expected to increase despite some post-COVID reductions.

7. Nashville 

Nashville is another exciting place for potential multifamily investors looking to grow their earnings. The city’s increasing job opportunities post-COVID, plus a drive towards cheaper secondary markets, multiply Nashville’s multifamily investment demand.

The city has a 46% renter occupation and had a vacancy rate of 6% in Q2 of 2020 among its 806,178 housing units. Despite the 1% year-over-year contraction, Nashville’s average rent of $1,404 has generally increased since 2018.

6. Boise

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Boise comes sixth in our list of best cities for real estate investment in 2023. Though rents slightly reduced this year, Boise has seen them rise by more than 26% since 2018. The average rent of $1,279 as of October 2020, has increased by 8% year-on-year and fits well within the $66,466 median household income. 

5. Boston

Boston has about 4.87 million individuals living in the larger Boston-Cambridge-Newton MSA. The small city remains a formidable location option for potential multifamily investors. Its over 1.9 million housing units have a 51% renter occupation and a 7% vacancy rate. Despite a 7% year-on-year contraction, the average rent of $3,185 lies well above the national average.

4. Austin

With a current population of 2.7 million and a 2.48% year-on-year increase, Austin leads the rest of Texas with the lowest multifamily cap rates. 

Austin’s over 882,000 multifamily housing units have a 48% renter-occupation and an 8.5% (12.5 in Class A apartments) vacancy rate. The most recent average rent of $1,384 contracted by 2.99% from the preceding year. But it still sits well within the median household income budget of $80,954.

3. Salt Lake City

This region stands tall in our list of top places for investors to find multifamily properties for sale. Salt Lake City’s viable economic indices and higher yield spread over nearby states attract increasing multifamily investments. Its 1.2 million people (growing at 1.62% annually) have a median household income of $80,196.

Before the pandemic, Salt Lake City transacted $1 billion-plus in multifamily sales, having almost 434,000 housing units (at 32% renter occupation; 4% vacancy). We expect the market to recover post-COVID and resume its initial trajectory quickly.

2. St. Petersburg/Tampa

Tampa is also on this list of best cities for multifamily real estate in 2023. A frequently visited tourist destination, Tampa has a population of over 3.194 million in the larger area.  Various economic indicators, including rising rents, more jobs, and increasing apartment units, continue driving demand for multifamily properties. Tampa/St. Petersburg hosts 1.45 million housing units, with transactions continuing into 2023.

1. Durham/Raleigh

The Raleigh/Durham area remains a relatively stable multifamily market with net absorption and fresh supplies driving multifamily investments. The region’s fast population growth of 1.82% year-on-year is expected to continue. Over 862,000 housing units are in this top-performing market with 36% renter occupancy and 4.7% vacancy. With a 1.4% increase to the average rent of $1.22 per square foot, the region is ready to accommodate more demand with the median household income sitting at $73,654.


While some investors would instead observe, others are diving into the pool of multifamily real estate investing. As the pandemic’s negative impacts recede and economies revive, multifamily markets look to recover and continue their previous strong performances.

Read next: The Best Cities for Short-Term Real Estate Investment in the US

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About the Author

Tomás Fonseca is the host of two popular podcasts in the real estate industry, including the Icons of Real Estate Podcast and the Ardor RE Marketing Podcast.

Known for his charismatic hosting style and infectious positivity, Tomás brings his Portuguese charm to all of his interactions, making him a beloved figure in the community. Tomás loves to travel and to deliver high-quality content and valuable insights to his listeners.

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