Atlanta, Dallas, Houston and Phoenix to lead the way

Our apartment metro forecasts continue to show significant variation between metros, even within regions. For example, while we expect continued strong demand growth in the South – especially in Austin, Miami and Dallas – we also expect high volumes of new supply in metros such as Austin and Miami, which will weigh on rent growth and, ultimately total returns in those two markets. D.C. will also suffer from rapid inventory growth in the next couple of years, but prospects for LA, Chicago and Boston look much better. Indeed, we think capital growth could reach close to 20% in Boston between 2025 and 2029, behind only four metros. The winners for capital growth will be led by the better-performing southern markets – Houston, Atlanta and Dallas – but they will also be joined by Phoenix, where we expect the second-best rate of employment growth and absorption over the next five years and completions that will not keep pace. On a total return basis, we expect to see 10% p.a. in Houston over 2025-29, but for Atlanta, Dallas and Phoenix to not be far off that level.