With a combination of a growing population, burgeoning job opportunities, and a competitive home buyers market, one Sunbelt market has emerged as a particularly compelling opportunity for multifamily investors.

In this article we’ll explore the factors that are drawing residents and investors alike to the Phoenix multifamily market.

A population boom

One of the primary drivers of Phoenix’s appeal as an investment hub is its rapid population growth. As one of the fastest-growing cities in the United States, Phoenix continues to attract a steady influx of residents drawn by its warm climate, high quality  lifestyle, and an abundance of job opportunities across various industries. 

The city has seen a population boom in recent years, with a 4% increase in residents, outpacing the national average for growth among large metro areas.¹ The workforce has a median age of 34 years and 78% is white collar.² 

Phoenix now ranks as the fifth most populous city in the US, such is the level of recent growth.³ This population surge fuels demand for housing, particularly multifamily units, creating a robust rental market that offers stability and potential for returns.

Robust jobs market 

Phoenix is notable for its job growth, showcasing a 2.3% YoY increase as of Q1 2024.⁴  Wage growth of 4.4% YoY has made it an attractive market for jobseekers; the labor force has increased 3.1% YoY and the median household income grew 2.9% YoY.⁴ 

Intel is investing $20B and constructing two semiconductor plants in the Phoenix metro area, expected to create 3,000 new high-tech positions, alongside 3,000 construction jobs during the development process.5 The tech giant already has a substantial footprint in Phoenix, employing more than 13,000 workers.⁵

Dozens of other tech companies have a presence in Phoenix as part of a shift in dynamics that has meant that the area has become known as The Silicon Desert. Some of the notable names include Lyft, ZocDoc, and Freshly, while nearby Tempe is home to Microsoft, Amazon, and Carvana.

Alongside the thriving tech sector, the Phoenix MSA also boasts a strong healthcare industry and a burgeoning startup ecosystem, attracting business and talent, while creating a strong, diverse economic market.

Demand for rental properties

Home prices in Phoenix remain close to the record highs recorded in 2022, and have increased 4.6% YoY,⁶ fueling demand for the rental market, which can offer residents more affordable housing alternatives.

Source: Zillow: Phoenix, AZ Housing Market

Potential homebuyers are battling high interest rates alongside high home prices, while low inventory is creating a further barrier in a market that is already facing a housing crisis according to local experts.⁷

The lack of inventory is a widespread problem in Arizona, with a shortage of 270,000 homes across the state.⁸

Investments in infrastructure

In recent years, Phoenix has witnessed significant urban revitalization initiatives and infrastructure developments, further bolstering the appeal of multifamily investments, as well as attracting business to new parts of the city. 

Currently, 86% of the population lives within one-half mile of transit, and the local government intend to increase this to 90% by 2050.⁹ 

The expansion of public infrastructure includes tripling the amount of light rail systems, increasing bus routes, and generally enhancing the accessibility across various hubs within the Phoenix MSA.⁹ 

These initiatives will expand connectivity across Phoenix, making multifamily properties located near transit hubs more attractive to tenants, businesses, and investors alike.

iintoo is currently offering access to the Phoenix real estate market through our combined CD-multifamily offering.

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(1) Axios: Phoenix’s population has grown by nearly 200K since 2020 / US Bureau of Labor Statistics 

(2) Point2Homes: Phoenix, AZ demographics

(3) Census: Population estimates 2024

(4) Cushman & Wakefield: Marketbeat Phoenix Multifamily Q1 2024 

(5) Intel: Intel’s Arizona Expansion Marks Construction Milestone

(6) Zillow: Phoenix, AZ Housing Market

(7) 12 News: Arizona’s housing crisis is only getting worse, experts say

(8) AZ Central: Arizona lawmakers have ideas to fix our housing problems

(9) City of Phoenix: Transportation 2050 Goals