Thursday, April 19, 2018

How to Find Continued Value in Apartment Acquisitions via National Real Estate Investor

The stability, durability and continued capital flows into multifamily investing permeate today’s headlines, with industry pundits believing apartments to be the most popular product type with real estate investors in 2018, second only to industrial. Mixed signals abound among varying markets, and it’s important to dissect and triangulate the real data as the analytics don’t always tell the full story.

Read more...How to Find Continued Value in Apartment Acquisitions

As Interest Rates Rise, Where Do Valuations and Transaction Volumes Go? via Multi-Housing News Online

ears of warnings that rising Treasury rates would depress commercial real estate prices—during an extended period when rates stayed low and acquisition yields fell to record lows—have given the concept a “boy who cries wolf” quality.

Those warnings, however, will be tested now that the 10-year Treasury seems poised to continue its growth of the past 18 months, and volatility has roiled the bond and equity markets. No longer can the market rely on the unusually large premium between Treasury rates and cap rates to buffer the impact of higher interest rates and the likely increase in mortgage coupons.

Read more...As Interest Rates Rise, Where Do Valuations and Transaction Volumes Go?

Wednesday, April 18, 2018

Eleventh District Beige Book 4/18/18 via Dallas Fed

he Eleventh District economy expanded at a moderate pace over the past six weeks. Growth in the nonfinancial services sector accelerated, and retail sales rebounded. Loan demand growth picked up. Robust expansion in the energy industry continued, while growth in manufacturing eased somewhat. Home sales continued to rise. Hiring was solid across most sectors, and widespread labor shortages continued. Wage and price growth remained elevated, and several contacts noted a marked rise in the cost of steel. Outlooks, while still optimistic, have become more uncertain due to new tariffs and trade concerns.

Read more...Eleventh District Beige Book - Dallasfed.org

Tuesday, April 17, 2018

Competition Intensifies for Value-Add Assets via National Real Estate Investor

For the past several years, investors have turned to the value-add strategy when seeking outperformance in a competitive commercial real estate landscape.

And it appears the interest in these type of deals has only intensified lately, with competition becoming increasingly stiff as the industry faces the likely end of the cycle and rent growths have moderated for core assets.

Read more...Competition Intensifies for Value-Add Assets | National Real Estate Investor

Friday, April 13, 2018

ALN Monthly Market Stats April 2018 via ALN Apartment Data

ALN Data just released their March 2018 market stats on occupancy and rents for over 80 markets. In Texas, it includes DFW, Austin, Houston, San Antonio, Lubbock, Amarillo, Abilene, Corpus Christi and more. It is a must read from a great provider of apartment data. Check out their new website.

Read more...ALN Monthly Market Stats April 2018 via ALN Apartment Data

Wednesday, April 11, 2018

Austin Economic Indicators 4/5/18 via Dallas Fed

Austin economic activity accelerated in February. The Austin Business-Cycle Index grew at its fastest pace since late 2015, bolstered by strong employment growth over the first two months of this year. The unemployment rate increased slightly but remained near a two-decade low. Regional real estate indicators point to robust housing growth. Census data for 2017 suggest that Austin’s population growth was well above the state average.

Read more...Austin Economic Indicators - Dallasfed.org

Prices Keep Rising for Apartment Properties via National Real Estate Investor

Investors keep looking for apartment buildings to buy at good prices. The search is leading them to smaller properties in smaller markets.

“Things continue to be very good in multifamily,” says John Sebree, national director of the national multi housing group with brokerage firm Marcus & Millichap.

The amount of money multifamily investors are spending has stabilized at a high level. Investors continue to accept relatively low yields on their acquisitions, even though interest rates rose substantially in 2017 and are expected to rise further. Part of the reason is that apartment rents continue to rise across the country, attracting investors to bid for new properties.

Read more...Prices Keep Rising for Apartment Properties

Friday, April 6, 2018

March 2018 Shows Best Rent Growth Performance via Multi-Housing News Online

March multifamily rents had its best performance since last summer, with average U.S. rents increasing by $4 to $1,371. Despite this, growth dropped 10 basis points year-over-year to 2.5 percent, decelerating from its peak of 5.4 percent growth in early 2016. Major concerns for the industry included peaking supply, declining occupancy rates and affordability, which had led many to speculate if the flattening growth since last summer was a natural pattern or if rents would remain flat for an extended period of time.

Read more...March 2018 Shows Best Rent Growth Performance

Apartment Completions Are Booming, But So Are Rents via CandysDirt.com

There may be a lot of apartments being built in Texas, but that’s not necessarily translating to more affordable rents, one economist said at a recent conference on affordable housing held at the Federal Reserve Bank of Dallas.

Greg Willett, chief economist at RealPage, told the group assembled that the same affordable housing issues that have begun to block families from purchasing homes have begun to crop up in the rental sector as well.

“We are starting to see the same affordability challenges in rental housing,” he said, adding that this issue is occurring despite a boom in apartment completions across the country.

Read more...Apartment Completions Are Booming, But So Are Rents

Wednesday, April 4, 2018

Houston Economic Indicators 4/3/18 via Dallas Fed

The outlook for Houston remains positive. Houston has had a robust start to 2018 job growth, broad measures of output have expanded, energy-related activity and related imports have continued to improve, and oil prices remain in a healthy range for the energy industry. However, lagged data on wages and retail sales suggest that income and spending had not yet turned up by the third quarter of 2017.

Read more...Houston Economic Indicators - Dallasfed.org

Tuesday, April 3, 2018

Embracing Disruption: The Apartment of the Future via Property Management Insider

As stewards of the multifamily housing industry, we each have visions for the apartment of the future. Some may see it as a techno-eccentric unit, a place in a world unto itself that stimulates the imagination and promotes self-indulgence in urban playgrounds. Others could argue it supports sophistication, lifestyle and basic essentials and redefines the old real estate axiom of location, location, location.

Talk to any developer or apartment operator and they’ll agree that the shape of multifamily now is likely to morph into something far beyond the traditional, even by today’s standards.

Read more...Embracing Disruption: The Apartment of the Future

It’s Time to Solve the Workforce Housing Supply Problem via Multifamily Executive Magazine

Drive down the road in most U.S. cities and it seems like every new multifamily development is billed as a luxury living experience. This situation is more than just clever marketing; it belies a growing problem: Many U.S. markets have a robust supply of high-end units but not much in the way of workforce housing.

According to the Urban Land Institute, workforce housing serves households making 60% to 120% of the area median income (AMI).

Read more...It’s Time to Solve the Workforce Housing Supply Problem | Multifamily Executive Magazine | Workforce Housing, Affordable Housing, Affordability, construction costs, Density, Land Costs, low-income housing tax credits, Urban Land Institute

RealPage: Rents Have Grown 28.5% This Cycle, Paced by Bay Area Metros via Multifamily Executive Magazine

Although the pace is slowing, apartment rental rates have been growing nationally for eight consecutive years, a new report from RealPage shows. And overall this cycle, which began in 2010, U.S. apartment rates have grown 28.5%.

On an individual basis, markets on the West Coast have led the way in terms of rent growth, including six of the top 10 leaders since 2010.

Read more...RealPage: Rents Have Grown 28.5% This Cycle, Paced by Bay Area Metros | Multifamily Executive Magazine | Rents, Rent Trends, Local Markets, Rent Growth, Markets, San Francisco-Oakland-Fremont, CA, San Jose-Sunnyvale-Santa Clara, CA

Monday, April 2, 2018

Texas Economic Indicators 3/26/18 via Dallas Fed

Texas economic growth remained robust in February. The state posted strong job gains, and unemployment remained low. The Texas Leading Index ticked down following several months of strong growth. Home inventories remained low, and home sales rose in the month, while indicators of residential construction were mixed.

Read more...Texas Economic Indicators - Dallasfed.org

Monthly Review of the Texas Economy 3/27/18 via Real Estate Center at Texas A&M

The Texas economy continues to outpace the U.S. economy in job creation. The state gained 285,200 nonagricultural jobs from February 2017 to February 2018, an annual growth rate of 2.3 percent, higher than the nation's employment growth rate of 1.6 percent (Table 1 and Figure 1). The nongovernment sector added 283,500 jobs, an annual growth rate of 2.8 percent, also higher than the nation's employment growth rate of 1.8 percent in the private sector (Table 1).

Read more...Monthly Review of the Texas Economy - Real Estate Center

Houston Economic Indicators 3/21/18 via Dallas Fed

Recent economic data remain positive for Houston. January employment growth was healthy, and job growth in 2017 was stronger than initially estimated. Though business bankruptcy filings remain elevated, leading indicators of local employment growth have been improving and suggest Houston will receive a tailwind from the state and national economies.

Read more...Houston Economic Indicators - Dallasfed.org

Dallas-Fort Worth Economic Indicators 3/28/18 via Dallas Fed

DFW economic growth continued in February, with payroll employment expanding and unemployment staying low. Looking at the two-month period, employment growth has been strong at 3.0 percent. The Dallas and Fort Worth business-cycle indexes expanded last month. Housing affordability remained low in Dallas but improved slightly in Fort Worth in the fourth quarter. DFW house price gains outstripped those nationally last year, and home inventories remained very tight in February.

Read more...Dallas-Fort Worth Economic Indicators - Dallasfed.org