Investors are following the recent renter migration patterns, with 75.8% of multifamily investment happening outside of major metros last year, according to new research from Newmark. This is the highest investment allocation outside of big cities on record.

While the pandemic certainly encouraged renters to migrate to new markets, it wasn't the impetus for the trend. According to Newmark, investment capital has slowly been increasing investment allocation to smaller markets. Over the last five years, investment into non-major markets has increased 13.9%. Overall, non-major metros typically capture more investment attention—because there are more smaller markets than larger markets—and the share of investment is also trending in favor of non-major markets.

Although there was an overarching trend of renters leaving big cities during the pandemic, not all metros experienced the same challenges. Big cities with a strong urban concentration, like New York and Philadelphia, had better occupancy through the pandemic. Many renters moved to adjacent suburbs, helping the greater market areas to retain stability. On the other hand, markets with less of an urban concentration, like Seattle, San Francisco and San Antonio, had occupancy rates that trended below the national average.