2012 Apartment Market Summary via Axiometrics

The apartment market produced steady, solid results throughout 2012. While many MSAs moderated from peak rent growth levels achieved during the summer of 2011, national effective rent growth still averaged a healthy 3.85% over 2012. Also in 2012, the occupancy rate averaged 94.2%, as compared to an average of 93.9% in 2011. Because of seasonality, the December rates are lower than the full-year average, but not by much. Annual effective rent growth was 3.72% in December while the occupancy rate was 94.1%.

For 2013, Axiometrics is forecasting effective rent growth of 3.6% at the national level. While the overall growth is forecasted to be relatively the same as 2012, effective rent growth is forecasted to improve in some MSAs while moderating in others. In addition, the national average occupancy rate for stabilized product is forecasted to rise in 2013 to an average rate of 94.9%. For the national average to achieve that occupancy rate, Class C properties will need to build on the momentum they generated during 2012. The main factors in the validity of the forecasts are continued job growth, acceptance of rent increases by consumers for a fourth consecutive year, and absorption of new supply.

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