Transcript
Everyone has an opinion about the best real estate market. Ask 10 investors and you'll probably get 10 different answers. Some swear by Dallas, others love Phoenix, some won't invest anywhere except for Florida. But here's the problem. Most of these opinions are actually based on headlines or personal experience or whatever worked for them 5 years ago.
So we wanted something more objective. So we built Market Magic AI. And this analyzes dozens of economic and real estate indicators across markets in the United States. Job growth, population trends, new apartment supply, housing affordability, income growth, rent to income ratios, and many, many other factors. And today I'm going to give you the top 10 metros for multifamily investing in 2026 according to Market Magic AI.
But please understand something before we start. So a high ranking definitely, definitely does not mean that I would blindly buy some property there tomorrow. Right? Every market's got strength, every market's got risks. And ranking sort of tells us where the data is pointing us.
So, you know, be careful. And let's start with number 10 and then work our way to number one. Number 10 is Raleigh, Cary, North Carolina. And Raleigh's got very, powerful, very powerful long-term demand drivers including the research triangle. They've got a very strong employment base, but there's a catch.
A lot of apartments are being built and that new supply is still putting tons of pressure on rents. So I like the long-term story here more than the short-term rent story. Number nine is tiny Heber, Utah. This one's much more interesting because it's much smaller than the rest of the markets on the list. It's part of a very high cost housing markets, limited rental inventory compared with large metros that we're going to discuss today.
But small markets come with small market risk, right? We have less economic diversification. So individual deals and location Camden matter enormously here. Number eight is Philadelphia Camden Wilmington, right? Very different story, huge diversified economy, apartment demand has been absorbing the recent construction wave.
Uh their pipeline's also shrinking and that's important. When new construction slows while people continue renting apartments, the balance can start shifting back towards landlords. Number seven by the way on the list is Seattle Tacoma Bellevue, right? Seattle still has something I really like which is high barriers to homeownership. That keeps a ton of people renting.
Apartment demand's been strong enough to improve occupancy recently. Um caution is the employment environment particularly in the higher paying white-collar jobs. Uh plus they've got a pretty active construction pipeline, so watch out for that. Number six is Boston Cambridge Newton. Boston's really expensive.
I mean very expensive, but that's actually part of the rental story. Homeownership is very difficult for uh households and that keeps people renting much longer. And at the same time Boston's construction pipeline has been really shrinking. So, you've got the high barriers to homeownership, you've got the constrained future supply, and durable renter demand. Now, the downside is you're paying a lot to get into this market, a lot.
Okay, now we're getting into the top five. Number five is Phoenix Mesa Chandler. And Phoenix it it got absolutely hammered by new apartment supply and rents have been paying the price, they've been going down. But something interesting has been happening. Demand has been so strong that vacancy is actually been improving.
And the construction pipeline has fallen substantially from its peak. So, Phoenix is Phoenix I guess it's not interesting because it's you know, problems disappear. It's interesting because the market may finally finally be digesting that enormous wave of supply. All right. Number four.
Number four is Atlanta Sandy Springs. Atlanta had a similar problem, right? So too many apartments but absorption has become you know, it's could be done outrunning new deliveries and rent growth has started showing signs of improvement finally in 2026. Um doesn't mean that every Atlanta submarket is healthy. Far from it.
But the direction of travel is becoming much more interesting to me now. Okay. Number three is Dallas Fort Worth and you know, this one obviously shouldn't surprise anyone. Tremendous population and employment scale. Apartment demand is enormous.
The problem really is supply because developers built an extraordinary number of apartments here. And that's put pressures on rents and occupancy but construction's slowing. So you know, Dallas is a great you know, example of why you can't look at just one number, right? Fantastic demand, fantastic long-term prospects. You still have to respect the supply pipeline.
Number two is Houston. Houston's construction pipeline has also been falling. So we're beginning to see renewed momentum in several submarkets. And Houston also gives you something that investors really love. You know, scale.
There's massive economy, enormous and renter base. The only caution is vacancy and the fact that there's still supply to work through. And performance can vary dramatically depending upon the submarket. So be be aware of that. All right.
Number one on our list is Washington. Now this one may surprise you especially because Washington hasn't had a very visible employment. You know, it's got government-related headwinds, but that's exactly why we use data instead of simply following headlines. Market Magic isn't designed to tell you buy here. It's designed to tell you look here.
Because Dallas can have phenomenal population growth and too much supply at the same time. Phoenix can have falling rents and have improving fundamentals. Boston can have fantastic rental demand, but very, very expensive real estate. So, real estate markets are are complicated. And that's exactly why relying on anyone's statistic or somebody's opinion is very dangerous.
You want to look at the complete picture. So, if you'd like to analyze all of these markets yourself or you put your market through the same process, please try Market Magic AI. It's free. And tell me something in the comments, which market in this top 10 surprised you the most? Want more free resources to help you make better investing decisions?
Join the Investor Club for free. It's at multifamilyu.com/club. Thanks for watching and I'll see you in the next video. Bye-bye.