Several US markets are experiencing significant population growth and drawing attention from real estate investors considering multifamily opportunities in light of the prevailing barriers to homeownership in today’s macroeconomic environment. Potential investors are taking note of a number of developing trends in markets they may not previously have considered. 

On top of the high mortgage rates continuing to blunt borrowing power, average home prices nationally are now rising 0.6% monthly, a pace that’s consistent with the 5% to 6% yearly increases seen in the lead up to the pandemic.¹ Further, the median down payment for US homebuyers has spiked 24.1% YoY as of February 2024, the largest annual percentage increase since Q2 2022.²

With these market shifts come a heightened demand for cheaper rental alternatives. To that end, let’s focus on three of the fastest growing MSAs in the US, per a recent Bank of America Institute report, and examine if these are compelling areas of opportunity for real estate investors.

A growth market in the South

Jacksonville, Florida stands as one of the main beneficiaries of the population swell in the South, and potential investors are keenly watching its rent growth rate in 2024, which is outpacing the first quarter of 2023. Median rents have increased 0.5% in Q1, while the month-over-month rate is matching the national average.³ 

The city saw population increases in both Q3 and Q4 of 2023, positioning it ahead of Tampa in the growth rankings and stating its case in the already popular Florida market.⁴

Also of note is a strong jobs market, fueled by a diverse range of industries, which means that Jacksonville has had a low unemployment rate for several years, consistently outperforming the US average.⁵

The resilient economy boasts industries as varied as aviation and aerospace, life sciences, and financial and insurance services, attracting a steady flow of new residents. The biggest uptick in jobs is being seen in the private education and health services sector, which had a 4.1% growth rate as of February 2024.⁶

In turn, home prices are on an upward trajectory, showing an 7.5% YoY increase in the median price,⁷ giving potential investors reason for optimism. 

A growth market in the Midwest

Columbus, Ohio has seen remarkable expansion in recent years, with the market’s shift from its industrial past to a thriving tech hub catapulting it into the spotlight and attracting residents and investors alike. The recent population boom has led to the city being named the fastest growing in the US per a Bank of America Institute report.⁴

The metro area has made headlines as the home to a sprawling $20 billion mega-site for the production of semiconductor chips currently being built by Intel. The tech giant was awarded $8.5 billion in grants through the US CHIPS act, set to be split between four facilities including a 1,000 acre chip manufacturing mega-site in Columbus.8  This positive development comes after several years of expansion that has seen the metro area attract other major tech companies such as Google, Meta, and IBM. 

Columbus has seen 3.8% YoY rent increases as of February 2024, and saw 2.0% job growth during 2023.⁹ The flourishing jobs market and low cost of living make it an attractive destination for renters, particularly young professionals, with a median age of 32.¹⁰

While the population is increasing, at the same time, Columbus is experiencing a shortage of housing for its residents. Despite this existing gap in supply and demand, in 2023, new home construction fell to its lowest level in five years, a trend that savvy investors are paying close attention to.11 Single-family home construction permits decreased by 13% compared to the previous year, while a more significant drop occurred in apartment and condominium construction which saw a 19% reduction.11

A growth market in the West

Las Vegas, Nevada has seen consistent population increases recently, with the fourth fastest growing population in the US in the second half of 2023⁴ and 0.6% YoY growth in total for the year.¹²

Nevada as a whole was hit hard during the pandemic due to its reliance on the entertainment and tourism industry, and the unemployment rate has been higher than the national average as a result. However, there are signs of a rebound. Las Vegas saw 4.1% YoY job growth by the end of 2023,¹³ and Nevada is now the sixth fastest growing economy in the US.¹⁴ 

The Vegas housing market has seen median prices rising steadily upward since early 2023, showing a substantial 10.6% YoY increase,¹⁵ This trend suggests that residents may be more likely to seek rental alternatives to homeownership. The most recent data from Yardi Matrix shows that rent prices are increasing by close to 1% across all asset classes.13 The market also saw positive absorption in 2023 in a further sign of optimism for potential investors.¹⁶

Population growth is an encouraging signal for any market and something that investors should always keep a keen eye on, particularly as potential homebuyers face pressure and seek cheaper rental alternatives. By paying close attention to macroeconomic trends and weighing the factors involved, investors can identify exciting opportunities in burgeoning markets that may become the ‘next big thing’ in real estate.

Our latest offering in Columbus is an income-generating multifamily asset located close to Intel’s semiconductor plant, and capitalizing on the strong fundamentals in the market. Log in to our platform to see detailed information.

1. CNBC: Home price growth is back at pre-pandemic levels. Here’s what that means for buyers and sellers
2. Redfin: The Typical Homebuyer’s Down Payment Is $56,000, Up 24% From a Year Ago
3. Apartment List: Jacksonville, FL Rental Market Trends
4. Bank of America Institute Report: “On the Move – West side story” Feb ’24
5. Bureau of Labor Statistics: Unemployment Data
6. Jacksonville Daily Record: Metro Jacksonville’s unemployment rate holds steady at 3.3% in February
7. Redfin: Jacksonville, FL Housing Market
8. CNBC: Intel awarded up to $8.5 billion in CHIPS Act grants, with billions more in loans available
9. Yardi Matrix: Multifamily National Report Feb ‘24
10. Point2Homes: Columbus, OH demographics
11. Columbus Dispatch: Columbus home construction drops to five-year low despite housing shortage
12.  Las Vegas Review Journal: How fast did the Las Vegas Valley grow last year compared to other areas?
13. Yardi Matrix: Multifamily National Report March ‘24
14.  2News Nevada: Nevada has sixth fastest growing economy
15.  Redfin: Las Vegas, NV Housing Market
16.  Avis Young: Las Vegas multifamily report Q4 2023