Home prices heading for triple-dip

The besieged housing market has even further to fall before home prices really hit rock bottom. According to Fiserv (FISV), a financial analytics company, home values are expected to fall another 3.6% by next June, pushing them to a new low of 35% below the peak reached in early 2006 and marking a triple dip in prices.

Home prices heading for triple-dip

APARTMENT MARKET STATISTICS: October 2011

Industry statistics are featured in the October 2011 issue of Multi-Housing News.

October Apartment Market Statistics

Halloween Tips for Multifamily Property Managers

Halloween Tips for Multifamily Property Managers

10 Myths About Bed Bugs Property Managers Need to Know

10 Myths About Bed Bugs Property Managers Need to Know

ENERGY STAR-Type Ratings for Apartment Units? It’s Possible.

According to a recent study by Recap Real Estate Advisors entitled, “Multifamily Utility Usage Data: Issues and Opportunities,” data on energy consumption in multifamily dwellings is incomplete, suggesting the difficulty apartment complexes have tracking the energy efficiencies of units.

ENERGY STAR-Type Ratings for Apartment Units? It’s Possible.

CMBS defaults fall and spreads tighten « HousingWire

CMBS defaults fall and spreads tighten « HousingWire

CMBS special servicers challenged by rising troubled loans « HousingWire

CMBS special servicers challenged by rising troubled loans « HousingWire:

Top 10 Tips for Acquiring Distressed Multifamily Properties | Multi-Housing News Online

Michael Bull wrote an outstanding article on acquiring distressed multifamily properties. Check out Michael's weekly radio show at http://www.commercialrealestateshow.com/ or ITunes. It is a great listen.

Top 10 Tips for Acquiring Distressed Multifamily Properties | Multi-Housing News Online:

Apartment Sales Volumes Remain Strong - Dispositions And Transactions - Multifamily Executive Magazine

Apartment Sales Volumes Remain Strong - Dispositions And Transactions - Multifamily Executive Magazine:

GlobeSt.com - Environmental Due Diligence 101 - Why is it required? - The Science of Real Estate Article

Keeping with the due diligence thread, here is a article on environmental due diligence.

GlobeSt.com - Environmental Due Diligence 101 - Why is it required? - The Science of Real Estate Article

GlobeSt.com - Due Diligence in Commercial Real Estate Deals - Practical Counsel Article

Great article on the basics of the due diligence process.

GlobeSt.com - Due Diligence in Commercial Real Estate Deals - Practical Counsel Article

CoStar -CRE Liquidity Conditions: Between a Desert and a Dry Place - CoStar Group

There was good news and bad news in the latest flurry of bank earnings reports when it comes to their willingness to fund commercial real estate. The good news: they are showing a renewed interest in CRE loans. The bad news: they are probably not interested in most of the deals for which borrowers need financing.

Read the entire article here CRE Liquidity Conditions: Between a Desert and a Dry Place - CoStar Group:

Texas Cranking Out Jobs

Texas created 19.4 percent of total jobs created in the United States from September 2010 to September 2011. Texas gained 248,700 nonfarm jobs during the period, an annual growth rate of 2.4 percent compared with 1.1 percent for the United States. The state's private sector added 281,400 jobs, an annual growth rate of 3.3 percent compared with 1.7 percent for the nation's private sector.

Read the report here,TEXAS CRANKING OUT JOBS

Texas Comptroller’s Economic Outlook

Job growth, sales tax collections – both from business and consumer purchases – as well as automobile sales, signal that the Texas economy has emerged from the recent recession.

Texas Ahead: Economic Outlook:

Rents and Occupancy Surge in Austin

Austin ranked third in the nation with year-over-year revenue growth of 8.9 percent, behind only San Francisco and San Jose. How’d it get there? Jay Parsons explains in this video edition of Apartment Market Dynamics.

Rents and Occupancy Surge in Austin

ALNdata Releases September Newsletter

ALNData just released their September 2011 stats on occupancy and rents for 23 markets. In Texas, it includes DFW, Austin, Houston, San Antonio, Lubbock, Amarillo, Abilene and Corpus Christi. It is a great read from a great provider of apartment data.


ALNdata.com September Newsletter 

GlobeSt.com - Apartments Hit High Gear, But Will the Engine Overheat?

The apartment market has hit high gear, fueled by strong demand and cheap debt, but some in the industry question if the sector might be going too fast for conditions.

GlobeSt.com - Apartments Hit High Gear, But Will the Engine Overheat?

The 4-Step Bed Bug Action Plan for Property Managers

I’ll be blunt: It’s not a question of if you’re going to experience bed bugs on your apartment property, but when. There is no way to avoid this pest. But you’re not helpless when it comes to dealing with bed bugs. You have the ability to maintain a level of control by how you prepare for and respond to a bed bug infestation.

The 4-Step Bed Bug Action Plan for Property Managers

Nine Reasons to Invest in Texas

High-dollar investors from around the nation are sinking big bucks into Texas. With its massive economy, growing population and comparatively low taxes, what’s not to like?

Nine Reasons to Invest in Texas

GlobeSt.com - Don’t Over Pay for Vacancy - Commercial Property Advisor Article

Valuing buildings with significant vacancy is a common challenge for today’s real estate investor. A simple capitalization rate methodology is of limited use as it will not reflect the intrinsic value of the vacant space. 


A discounted cash flow (DCF) analysis is the preferred valuation approach, yet has the limitation of generating a single internal rate of return for the blended cash flows of both existing and vacant-space tenants. You should require a higher IRR for cash flows associated with the vacant space due to increased commensurate risks.


In this period of economic uncertainty, it may make sense to be aggressive on your pricing for in-place leases to quality tenants, and extremely cautious about the prospects of leasing vacant space. A segmented DCF analysis will help you price this strategy appropriately. 


Continue reading this very interesting article:
GlobeSt.com - Don’t Over Pay for Vacancy - Commercial Property Advisor Article

Troubled Commercial Real Estate Fixes Are Half Done

It will take two to four more years to resolve bad commercial property debt built up since the financial crisis of 2008, analysts estimate.


The task is taking so long amid an "extend and pretend" policy that lets banks carry toxic loans on their books. It's what has so far prevented a more severe commercial real estate meltdown, according to a number of industry observers.

They maintain that defaults peaked in 2009, and warn that property values now stabilizing could begin falling again if regulators start pressuring banks to reconcile nonperforming loans faster.

Read the entire article Troubled Commercial Real Estate Fixes Half Done

Special Servicers to Borrowers: Buh-Bye, Modifications

During the RealShare Distressed Assets “Special Servicers Power Panel,” produced by Real Estate Forum and GlobeSt.com, it was very clear that loan modifications are fast becoming things of the past.

Why the turnaround? Are servicers becoming more selfish? Not necessarily – but they are becoming fatigued. One thing they’re getting tired of is borrowers who are demanding modification without wanting to give back.

This is not to suggest that all modifications have gone the way of those clichéd terms from 2008; toxic assets and “Wall Street to Main Street.” The panel said there were times during which modifications might be called for, especially if the sponsor is a solid one, the asset a quality one and enough capital is on hand to effect an improvement. If the servicers have a level of trust and a good relationship with the borrower, modifications are also possible. But the servicers were adamant that the free ride for shifty or unsophisticated borrowers was over.

GlobeSt.com - Special Servicers to Borrowers: Buh-Bye, Modifications - Daily News Article

Austin Energy Trackers

In case you missed the new energy audit law in Austin, Texas this past June, this is for you. If you own property in Austin make sure that you, or your management company, comply with the new law. If you are looking to buy in Austin, make sure you ask for the audit results.

Austin’s Energy Conservation Audit and Disclosure Ordinance requires that eligible commercial facilities (including multifamily residential buildings with five or more units) calculate their energy performance ratings not later than June 16, 2011, using a rating system approved by the director of the Austin Electric Utility. Building owners must disclose this information to a purchaser or prospective purchaser of the facility before the time of sale. The city has further defined the EPA’s Portfolio Manager as the approved system for buildings with more than 5,000 square feet of space. The ordinance does not apply to properties transferred via a foreclosure sale, trustee’s sale, or deed in lieu of foreclosure transfer.

MultiFamily Executive had a great article on some of the laws being passed around the country regarding the efforts to mandate energy bench-marking in the apartment industry. Read the article here.

Enery Trackers

Dallas Apartment Market Jumps Ahead of Fort Worth

The North Texas apartment sector posted another quarter of solid revenue growth in 2011’s 3rd quarter, but the big story is that Dallas is taking an unusually large lead ahead of Fort Worth in terms of both occupancy and rent growth. Jay Parsons explains in this video edition of Apartment Market Dynamics.

Make sure to watch the video.
Dallas Apartment Market Jumps Ahead of Fort Worth

Economic Concerns Cast Shadow Over CMBS Sector

According to an article appearing in today's National Real Estate Investor's email blast, "Economic Concerns Cast Shadow Over CMBS Sector". recent events have proved once again that even the best laid plans of real estate lenders often go awry. As the commercial real estate market stabilized in 2010 and conduit lenders began to feel more comfortable with property fundamentals, many industry insiders predicted CMBS issuance would spike to $40 billion or $50 billion this year. It doesn't look as though that is going to happen.

See the full article at:
Economic Concerns Cast Shadow Over CMBS Sector

CMBS Delinquency Rate Slightly Higher in September 2011

According to Trepp, CMBS delinquency rates for all major property types,except for lodging, were up slightly in September 2011. The Multifamily sector remained the worst performing property type while retail remained the best performer.

CMBS Delinquency Rates Stabilize in September

Dallas Effective Rent Growth in Top 10 Growth Markets

According to Axiometrics, effective rent growth (rent net of concessions) slowed somewhat during August, to a rate of 0.34%. This was the lowest rate of growth since December of 2010. Despite the August slowdown, however, effective rent growth for 2011 is still poised to be higher than it was in 2010.

Dallas, which was a bottom dweller in terms of annual rent growth a year ago, now is among the top growth markets.

To see complete story, click on the link below.

Effective Rent Growth Slows Occupancy Increases August

Federal Reserve Bank of Dallas Texas Economic Indicators Report October 2011

According to the Federal Reserve Bank of Dallas' October 2011 Texas Economic Indicators Report, the Texas economy grew at a modest pace, with employment expanding at a 1.6 percent annual rate in August. Texas home sales rose in August along with single-family permits and housing starts. Texas exports inched up in July, and manufacturing activity increased in August, according to the Texas Manufacturing Outlook Survey's production index. See the full report at FRB of Dallas-Texas Economic Indicators for October 2011

More on Bed Bugs

Since my post on bed bugs has been the most viewed, I thought I would add some updated information for detecting and mitigating bed bugs in commercial and multi-family properties. Bed Bugs have become the bane of the multifamily business. Some states have begun passing legislation to address the problems of bed bugs in commercial/rental property. I haven’t seen anything from the state of Texas yet, but some argue that the Texas Health and Safety Code SUBCHAPTER B. NUISANCES AND GENERAL SANITATION might apply. Remember to use the Texas Apartment Association Bed Bug Addendum as part of you lease package.

The Commercial Source blog had a post on August 16, 2011 title Bed Bugs Not Ballyhoo.It has a number of links to information about bed bugs, including the EPA, entomological experts and IREM. Check out the links to the specific data. There are a lot of ideas for identifying, treating and preventing bed bugs. It is probably more than you ever wanted to know about bed bugs but you can't bury your head in the sand on this topic.