Bolstered largely by an economic surge – over 58,000 new jobs in the past year – Phoenix is leading the nation in year-over-year rent growth.
As of May, rents in Arizona’s capitol rose 6.8% in the past 12 months, a study by Yardi showed. That rate is almost three times the U.S. average, while Phoenix’s employment growth rate in the past year – 3.1% – was nearly double the national rate.
A recent report from Freddie Mac also noted Phoenix’s growth, reporting that multifamily investors in the city saw the largest quarterly growth in net operating income at 3.2% – almost triple the next largest increase of 1.1% in San Francisco.
The multifamily market is keeping up with the demand, with 4,053 units coming online in the first five months of 2019, according to Yardi. As of April, Phoenix properties had an occupancy of 95.5%. This is nothing new for the metroplex, however. Last September, the city was ranked No. 2 on a Yardi study for projected rent growth by the end of 2018. At the time, the growth was charted at 5.6%.
Now with 6.8% rent growth, the city is, predictably, facing some affordability changes. Up 97% from 2011, the median home price in Phoenix is now $247,486 as the city sees in an influx of new residents who are coming mostly from California, according to Yardi.