Monday, November 23, 2020

CRE Prices Continue Their K-Shaped Recovery via GlobeSt

Commercial real estate prices continue to nudge along, or not, depending on their asset class. Their journey reflects a larger economic concept made popular in this recession: the K-shaped recovery, meaning that different parts of the economy are improving at different rates. While pricing in the retail and hospitality sectors continue to slide, apartment and industrial are posting gains, according to the RCA CPPI.

Pricing in the office sector sits between these two groups. Namely, for October, the US National All-Property Index rose 3.6% from a year ago, the apartment index rose 7.2% and the industrial index 8.5%. Retail prices were down 5.2% from a year prior. The office sector continued to fall at about a 1% annual rate, with suburban offices leading that slide, falling 1.6% year-over-year in October.

Read more...CRE Prices Continue Their K-Shaped Recovery via GlobeSt

Wednesday, November 18, 2020

Texas homeownership hits record high as sales surge via Dallas Morning News

The COVID-19 pandemic hasn’t put a pause on the increase in Texas homeowners.

The state’s homeownership rate just hit an all-time high of 70%, according to a new report from the Real Estate Center at Texas A&M University.

Texas' homeownership share now tops the nationwide rate of 67.4%. It’s the first time in eight years that Texas has surpassed the national average.

Read more...Texas homeownership hits record high as sales surge via Dallas Morning News

Apartment landlords lure renters with more freebies via Dallas Morning News

Renters searching for an apartment deal in North Texas won’t have to look far.

More than 41% of apartment properties are offering some kind of freebie to attract tenants, according to a new report from Zillow.

Apartment rental concessions in the Dallas-Fort Worth area and across the country have zoomed higher in the last year as landlords have scrambled to sign new tenants during the pandemic.

Read more...Apartment landlords lure renters with more freebies via Dallas Morning News

Texas Rebound Likely Slowed by Renewed COVID-19 Impact on Services, Retail via Dallas Fed

The Texas economy’s recovery from COVID-19 in the spring continues, though a resurgence of the virus likely contributed to a recent slowing of growth in the service and retail sectors.

Overall, Texas jobs grew at an annualized 3.6 percent in the third quarter, falling short of the national growth rate of 11.9 percent.

Read more...Texas Rebound Likely Slowed by Renewed COVID-19 Impact on Services, Retail via Dallas Fed

Suburbs Apartment Rents Close to Their Pre-Pandemic Peak via GlobeSt

Though the rental market in major cities has been hard hit by the Coronavirus pandemic—plagued with a mass migration by remote workers seeking larger homes, as well as relocations because of social distancing concerns—it appears that the suburbs have not just survived COVID-19’s wrath, they’re thriving in spite of it.

“While rents have declined steadily in the larger, denser, principal cities at the core of each metropolitan region, rents in the outlying suburban areas have, on the whole, rebounded to pre-pandemic levels,” according to a new report from Apartment List.

Read more...Suburbs Apartment Rents Close to Their Pre-Pandemic Peak via GlobeSt

ALN Monthly Market Stats November 2020 via ALN Apartment Data

ALN Data just released their October 2020 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.

Read more...ALN Monthly Market Stats November 2020 via ALN Apartment Data

Monday, November 16, 2020

NMHC: Pandemic Continues to Impact Multifamily Construction via Multifamily Executive Magazine

The ongoing COVID-19 pandemic continues to affect multifamily development, according to the latest round of the National Multifamily Housing Council (NMHC) Construction Survey.

Conducted between Oct. 6 and Oct. 27, 57% of multifamily developer respondents reported construction delays in the jurisdictions where they operate. Out of this group, 90% reported delays in permitting, which is the greatest share seen in the five survey installments since the end of March.

Read more...NMHC: Pandemic Continues to Impact Multifamily Construction via Multifamily Executive Magazine

CBRE Chief Economist: Cap Rates Will Trend Down When Crisis Alleviates via GlobeSt

Despite seeing economic headwinds in the short-term, and fall-out from the Presidential election, CBRE Global chief economist and head of Americas research Richard Barkham anticipates a recovery starting to take place in 2021. The executive has authored a new paper on the firm’s outlook for next year and was interviewed last week for CBRE’s Weekly Take podcast.

GDP growth this year appears to be at minus 4%, he said, but “we’re looking at the reverse of that in 2021, somewhere between 4% and 5% GDP growth.”

Read more...CBRE Chief Economist: Cap Rates Will Trend Down When Crisis Alleviates via GlobeSt

Friday, November 13, 2020

Can Apartment Players Finally Exhale? via Multifamily Executive Magazine

After months of suffering because of the Coronavirus pandemic, the multifamily sector is finally getting not just one good report but, instead, a healthy batch of good news. Several indicators are pointing to a change in landlords’ near-term fortunes while, for both the medium and long-term, the beginnings of a recovery are expected to emerge.

The number of rent payments received this month increased from October collections, albeit only by 1%, according to a new report from Rentec Direct.

Read more...Can Apartment Players Finally Exhale? via Multifamily Executive Magazine

Wednesday, November 11, 2020

We’re On Track to be a Renter Nation Again via GlobeSt

When the Great Recession sent scores of Americans out of their homes and Millennials began to move out on their own, renting took off in the early 2010s.

By the mid-2010s, 111 million people were renting in the US, according to RENTCafe.com.

Then, for the first time since 2004, the number of renters declined in 2016, ticking down 0.1%, according to RENTCafe.com. Since then, the renter population has been on a downward trend, decreasing by 1% in 2019.

Read more...We’re On Track to be a Renter Nation Again via GlobeSt

Tuesday, November 10, 2020

Why Apartment Rents Have Remained Strong Through the Pandemic via GlobeSt

Apartment rent payments overall have remained stable throughout the pandemic—a welcome surprise considering the rapid increase in unemployment. The reason? Renters have been prioritizing rent payments. This is according to Freddie Mac, which recently reviewed several apartment rent data sources, including National Multifamily Housing Council, The Household Pulse Survey, LeaseLock, Apartment List and National Association of Real Estate Investment Trusts.

Read more...Why Apartment Rents Have Remained Strong Through the Pandemic via GlobeSt

Apartment Demand Declines as Young Adults Return Home for the Pandemic via GlobeSt

The pandemic has driven gen-Z and millennials back home to live with parents or relatives— a trend that will negatively impact apartment demand, according to a new report from Marcus & Millichap.

Unemployment has been the biggest driver of young adults moving home, but college closures have also had an impact. In April and May, there was an increase in young adults age 18 to 34 moving home, and by June, 27.7 million young adults had moved home, according to Marcus & Millichap.

Read more...Apartment Demand Declines as Young Adults Return Home for the Pandemic via GlobeSt

Monday, November 9, 2020

Austin Economic Indicators November 2020 via Dallas Fed

The Austin economy continued to recover in September, although the pace of growth slowed. The Austin Business-Cycle Index decelerated. Job growth was broad based in the third quarter, but the unemployment rate recently ticked up. Regional consumer spending since mid-July continues to hold at pre-COVID-19 levels. Existing-home sales and building permit activity posted strong performances, and home inventories declined to a record low.

Read more...Austin Economic Indicators November 2020 via Dallas Fed

What Pandemic? CRE Prices Notch Up via GlobeSt

Right now, many commercial real estate investors are sitting and waiting for distressed deals.

But a look at the September US RCA CPPI National All-Property Index from Real Capital Analytics suggests they might have to wait a little longer.

The RCA CPPI rose just 1.4% year-over-year in September. To be sure, some investors have taken haircuts.

Read more...What Pandemic? CRE Prices Notch Up via GlobeSt

Friday, November 6, 2020

Multifamily Rents Declined at Record Pace in Q3 via GlobeSt

Job losses, combined with the expiration of unemployment benefits, may finally be taking its toll on the apartment market.

After multifamily held up reasonably well in Q2, national asking and effective rents declined at a record pace in the third quarter, falling by 1.8% and 1.9%, respectively, according to Moody’s Analytics REIS. That is the largest quarterly decline since 1999 when the company began publishing quarterly data. Before 2020, the most significant decrease occurred in Q4 2001—right after 9/11.

Read more...Multifamily Rents Declined at Record Pace in Q3 via GlobeSt

Small Apartment Pricing Improves in Q3 via GlobeSt

Throughout the COVID-19 recession, it has been anticipated that smaller apartment owners would bear the brunt of the problems in the multifamily sector.

If rent payments are late or units are empty, there are fewer apartments to spread that revenue loss over. Also, many tenants in smaller apartments are likely to have lost jobs in this recession.

Read more...Small Apartment Pricing Improves in Q3 via GlobeSt

Thursday, November 5, 2020

Houston Economic Indicators November 2020 via Dallas Fed

Houston’s recovery from the pandemic progressed further in September and October. Houston continued to add jobs in September, and staffing levels in small firms and mobility and engagement improved in October. Existing-home sales have been a bright spot. However, business bankruptcies and vacancy rates for commercial real estate worsened in the third quarter.

Read more... Houston Economic Indicators November 2020 via Dallas Fed

Real Estate Investors Adopt Divergent Strategies Amid Uncertainty via NREI

More than six months into the 2020 recession caused by the global health crisis, questions at the forefront for commercial real estate are how much investors dial back their economic outlook, property performance expectations and their plans to invest more capital. Yet the latest edition of the NREI / Marcus & Millichap Investor Sentiment Survey yields a surprising mix of both positive and negative views.

The Investor Sentiment Index has proved to be a reliable barometer for views on the commercial real estate industry across its more than 16-year history. Investor sentiment dropped sharply from 166 just ahead of the pandemic in the first half 2020 survey to 140 in the current second half survey that polled industry participants in late-August.

Read more...Real Estate Investors Adopt Divergent Strategies Amid Uncertainty via NREI

Multifamily Rides Out Pandemic With Minimal Changes via GlobeSt

In her new role as head of Agency Finance at Capital One, Kate Byford has wide visibility in the apartment sector.

The sector, like every part of the economy right now, faces headwinds. But Byford, who came to Capital One as senior vice president before serving as head of Capital Markets and Multifamily Operating Officer for Capital One Multifamily Finance, likes its long-term prospects.

Read more...Multifamily Rides Out Pandemic With Minimal Changes via GlobeSt

Tuesday, November 3, 2020

A Closer Look at Multifamily’s Widening Cracks via GlobeSt

Six months ago in the pre-pandemic world, concerns about matters such as rental growth stagnation for the multifamily asset class would have been laughable. Even as COVID-19 began to spread within the US, multifamily properties held their own, however more recently, a slightly different picture has emerged and cracks in the asset class have begun to widen. GlobeSt.com takes a closer look at what was once a seemingly unassailable asset class.

Read more...A Closer Look at Multifamily’s Widening Cracks via GlobeSt

Monday, November 2, 2020

Apartment building permits are dropping in D-FW and the U.S. via Dallas Morning News

The pandemic is a continuing drag on North Texas building starts.

Permits for new Dallas-Fort Worth apartment construction were down again in September.

“Dallas multifamily permits are down almost 20% from last year, but the market remains in the top five nationally with more than 13,300 units permitted for construction in the year ending in September,” RealPage’s Chuck Ehmann wrote in a new report. "Multifamily permitting has slowed even further in Fort Worth, which was down 29% from last September with 5,699 units permitted.

Read more...Apartment building permits are dropping in D-FW and the U.S. via Dallas Morning News