Phoenix Q1 Multifamily Market Report: Prices Rise, Cap Rates Compress to Start 2021


  • Healthy operations in the first quarter set the stage for another strong year in the Phoenix multifamily market. Vacancies continued to tighten, and rents posted one of the strongest quarterly gains on record.
  • Vacancy dipped 10 basis points to 4.5 percent in the first quarter. Year over year, the rate has fallen 90 basis points.
  • Asking rents spiked 3.3 percent in the first quarter, reaching $1,279 per month. Rent growth in the past 12 months has totaled 6.8 percent.
  • This year will be an active one for new construction, as developers move projects through the pipeline to meet renter demand. Projects totaling nearly 23,000 units are currently under construction, up from 13,000 units one year ago. Deliveries are forecast to total approximately 11,000 units in 2021.
  • Sales of multifamily properties surged in the first quarter, with sales velocity outpacing year-earlier levels by 16 percent. Prices rose, with the median price reaching $197,500 per unit to start the year, and cap rates compressed.

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