Apartment Markets with the Most Transaction Volumes in 2021

As the nation’s apartment market fundamentals rebounded from the pandemic lull, the appetite for continued investment into the sector followed a similarly remarkable trajectory.

In 2021, some 674,000 units were absorbed on net, surpassing the previous annual peak by some 60%. Subsequent occupancy rates continue to track at all-time high levels, and in turn both the relative stability of the apartment sector and its suggested upside in the coming years have fueled incredible investor demand as well.Trailing 12 (T-12) investment volume for apartments in 2021 clocked in at an impressive $335 billion according to data from Real Capital Analytics (RCA). That comprised roughly 47% of the four key Commercial Real Estate (CRE) sectors (in order of 2021 trade volume: apartments, industrial, office, and retail) and was the largest ever share of CRE investment belonging to apartments.

There have been a number of key investment trends that have evolved in the past two years. Arguably most prominent has been a shift of capital away from traditional hot spots (coastal Gateway markets such as New York and San Francisco) and into some of the nation’s larger Sun Belt markets (Atlanta, Dallas, Phoenix) in particular.   

Before diving into specifics of 2019 to 2021 shifts however, it’s important to start with some perspective on 2021 sales volumes by market. The RCA data points to a handful of distinct market tiers in terms of overall sales volumes.


Four of the nation’s largest 50 markets – Atlanta, Dallas, Phoenix and Houston – saw more than $15 billion worth of properties trade during 2021. Among these, Atlanta was a clear-cut leader surpassing some $20 billion during the year.

After Houston comes a fairly substantial drop, although volumes in the following four markets (Washington, DC, Denver, Los Angeles and New York) came in at a still-impressive total above $10 billion each. Historically speaking, DC, Los Angeles and New York were favored investment targets, although forthcoming graphs will show how shifts have occurred during the past two years.

Austin ($8.5 billion) and Orlando ($8.1 billion) came in with remarkable volumes considering the size of those metros relative to the aforementioned titan markets and shows how investors have begun to view these two markets relative to larger regional peers.

Yet another fairly large drop occurs before the following tranche of markets. There, markets including Seattle, Tampa, Raleigh/Durham and Charlotte recorded a tightly-ranked $6.2 billion to $6.4 billion worth of trades.

True to pre-pandemic form, many of the nation’s slower-growth Sun Belt markets such as Memphis and Greensboro alongside Midwest market peers remain relatively small within the scope of national investment interest.

Still, these numbers without comparative context don’t highlight the full essence of investment shifts. This following graphic highlights calendar 2021 sales volume to that of 2019, which was the pre-pandemic peak as 2020 investments were down across all commercial real estate sectors.

Similar to the graphic highlighting overall volume, the same order of top four markets (Atlanta, Dallas, Phoenix and Houston) all recorded massive upward shifts in total volume. Across these metros, between $8 billion and $11 billion more worth of properties traded in 2021 versus 2019.

Put another way, the pre-pandemic-to-current dollar change in Atlanta alone would have ranked as the #5 standalone market in the nation during 2021. Similarly, Dallas (which would have ranked #8) as well as Phoenix and Houston would have all settled in the nation’s top 10 based on the change alone.

The list of metros seeing a bigger shift isn’t terribly shocking based on the past 12 to 24 months’ worth of performance. Phoenix and Denver were two West region markets that maintained relative strength to their California counterparts throughout the past two years.

The Midwest markets yet again maintained a lot of their characteristic stability. Only Cleveland saw a modest slowdown in total investment while Indianapolis’ $1.6 billion uptick ranked as the largest Midwest region change (up from a comparatively modest $596 million in 2019).

But big shifts occurred in some coastal markets, in the San Francisco Bay Area and Seattle in particular. These markets (alongside Rust Belt metro Pittsburgh) were the only markets that saw a sizable drop in 2021 investment totals compared to their pre-pandemic level.

Another useful comparison is looking at percent change in investment volumes by market. From this view, the shift in market preference among investors paints a slightly different – although similarly useful – story.

In relative terms, investors flocked to South Florida markets. That trend closely mirrors a flow of population and migration shifts through the year as well, as many of the Florida-based markets saw an impressive rebound to nation-leading rent growth and occupancy increases during 2021.

A few markets such as Providence, Indianapolis and Detroit are small enough that fluctuations tend to be more pronounced from year-to-year. Still, Indianapolis and Detroit may have pulled in some investment attention beyond their normal levels as those two metros were solid performers throughout 2020. Such stability could be attracting some lower-risk, lower-reward type of investment activity.

Yet again, the trend for many Sun Belt markets pulling in a larger share of investment than the previous decade shows up as a noteworthy trend in the data. Places like Orlando, Nashville and Jacksonville alongside the Dallas, Atlanta, Houston trio of markets were newsmakers in 2021, both in terms of performance and investment. Strides were even made in the typically slower-growth Sun Belt markets such as Greensboro and Memphis.

Perhaps the biggest unknown on the horizon is just how much of this increased interest in Sun Belt metros is permanent vs. temporary. Realistically the answer is going to be somewhere in between. But there does appear to be a dichotomous shift that’s been spurred on further by the pandemic and subsequent market rebounds.