Thursday, June 25, 2015

Harvard Study: Homeownership Hits Historic Lows via Multifamily Executive Magazine

The American homeownership rate fell for the 10th consecutive year to 64.5%, according to a new study released Wednesday. Early 2015’s rate continued with the slump to 63.7%, the lowest quarterly rate on record since early 1993.

The State of the Nation’s Housing report, conducted by the Harvard Joint Center for Housing Studies, found that home construction is near historic lows and rental housing demand is forecast to break records.

Read more...Homeownership Rates Drop to Historic Lows; Middle Class Feels the Strain of Rising Rents (Press release from the Joint Center for Housing Studies, Harvard University) | Multifamily Executive Magazine

Two Big Concerns About Multifamily Market via GlobeSt.com

Multifamily developers are expected to deliver about 400,000 new apartment homes in 2015. This raises two concerns about what most of American renters need, according to Ella Shaw Neyland, president of Steadfast Apartment REIT, which has been acquiring multifamily assets in Atlanta and beyond.

“Although 400,000 is about 33% higher than the historic annual need for new supply, it does not catch up for the many years post recession where very few new apartment homes were constructed,” Neyland tells GlobeSt.com. “A recent report from Freddie Mac says that we may be in a situation where we are about 1.5 million apartment homes short of demand today. And that supply will not catch up with demand for the next nine years.”

Read more...Two Big Concerns About Multifamily Market - Daily News Article - GlobeSt.com

Top and Bottom 10 Metros for Renter Satisfaction via Multifamily Executive

Ten cities out of 100 were given A+ scores by renters for city satisfaction according to an ApartmentList.com survey.

More than 18,600 renters responded to several questions about the cities they live in. For example, renters were asked if they were likely to recommend their current city to a friend or family member. They were also asked if they felt their city’s local economy was on the right track. Apartmentlist.com officials took all of the responses and rated each city based on the scores and statistical data, including crime rates and quality of schools.

Read more...Top and Bottom 10 Metros for Renter Satisfaction

Where Are All the Middle-Class Rentals? via Bloomberg Business

Ryan Dravitz and a roommate shared a spacious apartment in Denver, paying $1,200 a month for 1,200 square feet in a high-rise building a mile from the center of downtown. Then, in 2012, the rental market exploded. The roommate moved out, and Dravitz, 26, moved into a house with four others. His old apartment is now renting for $2,000.

“Luckily, I got engaged recently, so we have a dual income,” said Dravitz, a bank teller and freelance writer and editor. Even so, it’s unlikely the couple will be able to afford to stay downtown, where rents are rising rapidly, and new rental buildings with such amenities as golf simulators and dog spas are becoming increasingly common.

Skyrocketing rents and multiple roommates—these are the kinds of war stories you expect to hear in space-constrained cities such as New York and San Francisco. But the rental crunch has been steadily creeping inland from coastal cities and up the economic ladder.

Read more...Where Are All the Middle-Class Rentals? - Bloomberg Business

Wednesday, June 24, 2015

Texas Economic Indicators June 2015 via Dallas Fed

The Texas economy modestly expanded, with employment growing at a 2.1 percent annual rate in May. Exports rose in April, and construction contract values surged in May. The Texas Leading Index ticked up in April for the first time since August 2014.

Texas employment edged up at a 2.1 percent annualized pace in May, slower than the nation’s 2.4 percent increase. Texas gained 20,300 jobs in May after adding 11,400 jobs in April. Current Texas employment stands at 11.8 million, according to the payroll survey (Current Employment Statistics).

Read more...Texas Economic Indicators June 2015 via Dallas Fed

How renting became the new homeownership via The Washington Post

The majority of American households still own their homes, a fact that will remain true as far into the future as demographers and economists can see. But the balance of homeowners and renters has been shifting in the U.S. in ways that have already altered the demographics of renting, the affordability of rental housing and the kind of new housing we build.

This shift, underway since the housing bust, is flipping conventional images of what it means to rent: Renters are now living, by the millions, in single-family homes that were once owned. Wealthy households far from the stereotype of struggling twenty-somethings are renting, too. So are the parents of those twenty-somethings.

Read more...How renting became the new homeownership - The Washington Post

DFW Economic Indicators June 2015 via Dallas Fed

The Dallas–Fort Worth economy slowed in May, with job growth dipping at a 0.6 percent annualized rate. Year to date, DFW employment grew 1.5 percent, outperforming the state’s 1.1 percent rate. Home price appreciation continued at a rapid clip, and housing affordability improved in the first quarter. Unemployment in Dallas and Fort Worth fell in May. Dallas Fed business-cycle indexes point to continued growth, albeit at a slower pace, for the metroplex.

DFW employment dipped 0.6 percent in May, following a solid 4.3 percent increase in April. Over the past 12 months, the metroplex has created jobs at a 3.2 percent rate, matching San Antonio’s pace.

Read more...DFW Economic Indicators June 2015 via Dallas Fed

Friday, June 19, 2015

Fair Housing Hot Topics: As Our World Changes, So Does Application of the Laws via Property Management Insider

During the recent Texas Apartment Association Education Conference & Lone Star Expo in San Antonio, Moore informed attendees that laws continue to touch everything housing providers do and more. And it’s not just those who provide government assisted housing that have to be careful.

“We’re seeing more and more conventional housing providers receiving complaints,” says Moore, who has spent more than 14 years arguing Fair Housing cases. “There is increased enforcement by the federal government.”

Moore isn’t sure why the pendulum of complaints seemingly is shifting to conventional but says recent activity suggests that all landlords need to be aware of changes in the application of Fair Housing laws.

Read more...Fair Housing Hot Topics: As Our World Changes, So Does Application of the Laws | Property Management Insider

IRR: Austin multifamily viewpoint forecast 2015 via Real Estate Center at Texas A&M

The multifamily market sector continues to lead the commercial real estate industry in many respects according to the 2015 IRR U.S. Cities Forecast/Conditions viewpoint.

In terms of underlying operating performance, Class B continued to outpace Class A performance with respect to occupancy in 2014.

Read more...IRR: Austin multifamily viewpoint forecast 2015

Is the Worst Over? Regional Economy Sees Hopeful Signs via Dallas Fed

The Texas economy had a rough start in 2015, with a sharp deceleration in growth from the end of 2014 to the beginning of 2015. Texas job growth expanded at a 0.8 percent annualized rate through April, down from 3.6 percent in 2014. A number of factors played a role in the sudden slowdown, but the decline in energy prices is foremost among them. Other adverse developments include the first-quarter slowdown in the U.S. economy, the strong U.S. dollar (which hurts Texas exports), the West Coast port strike that crippled Pacific trade (with implications for exporters and retailers in the Texas region), and adverse weather slowing construction activity and retail sales.

Compared with the weak first quarter, the regional economy is looking slightly better in the second quarter. An appropriate analogy might be that the dark clouds over the regional economy are breaking up just enough to let some rays of sunlight through.

Read more...Is the Worst Over? Regional Economy Sees Hopeful Signs - Dallas Fed

Thursday, June 18, 2015

Houston Economic Indicators June 2015 via Dallas Fed

After five months of slowing from its October 2014 peak, the growth rate of the Houston Business-Cycle Index turned negative in April as the index contracted by an annualized 3.6 percent due to a very weak April employment report. This is the first negative reading since October 2011 and the sharpest decline since November 2009. While weakness in the oil field is arguably spilling over into other sectors, many of the region’s nonenergy industries, such as health care and other personal services, are faring better. On balance, the Houston outlook continues to erode in the near term.

Total nonfarm employment fell an annualized 2.8 percent in April, making it the weakest payroll report since November 2009. Year-to-date job growth declined at an annual rate of 0.4 percent. Professional and business services, financial activities and other services joined manufacturing, construction and mining employment in negative territory for the year. Sharp April losses in construction and mining were concentrated in support activities for mining. All other supersectors picked up steam in April.

Read more...Houston Economic Indicators June 2015 via Dallas Fed

Apartment Occupancy Rate Sets Record with Fourth Consecutive Month Increase in May via MultifamilyBiz.com

The national apartment market recorded a monthly occupancy rate of 95.3% in May 2015, along with annual effective rent growth of 5.0% -- the fourth straight month the metric was at or above 5% -- according to Axiometrics, the leader in apartment and student housing research and analysis.

"The May rate historically is the start of each year's occupancy peak, meaning occupancy should remain at the current level or higher," said Stephanie McCleskey, Axiometrics Vice President of Research. "However, the market is considered functionally full at 95%, so increases might not be too large."

Read more...Apartment Occupancy Rate Sets Record with Fourth Consecutive Month Increase in May | MultifamilyBiz.com

Axiometrics Data Shows Strong Apartment Market via GlobeSt.com

The national apartment market recorded a monthly occupancy rate of 95.3 percent last month, along with annual effective rent growth of 5 percent--the fourth straight month the metric was at or above 5 percent, according to a new report from Dallas-based Axiometrics.

The four-month 5 percent rent-growth streak was the first since May-August 2011. The rate was also the highest May figure since the 5 percent of May 2011.

Read more...Axiometrics Data Shows Strong Apartment Market - Daily News Article - GlobeSt.com

Wednesday, June 17, 2015

High-Rise v. Garden-Style: Examining the Path to Prosperity via Property Management Insider

Modern times offer exciting opportunities for direct real estate investors. With properties across the spectrum realizing a significant growth trajectory, real estate investments can offer both attractive returns and diversification benefits. Specifically, apartments offer a long track record of favorable risk-adjusted returns, a higher dividend payout ratio and healthy growth of net operating income (NOI) relative to other property types. However, to determine the right strategy for apartment investing, investors have myriad factors to consider before deploying capital. All of the calculations, analysis and forecasting culminate into one overarching goal: to maximize returns and minimize risk.

Read more...High-Rise v. Garden-Style: Examining the Path to Prosperity | Property Management Insider

U.S. Commercial, Multifamily Mortgage Debt Reaches $40.4 Billion in Q1 via WORLD PROPERTY JOURNAL

According to the Mortgage Bankers Association, the level of U.S. commercial and multifamily mortgage debt outstanding increased by $40.4 billion in the first quarter of 2015, as all four major investor groups increased their holdings. That is a 1.5 percent increase over the fourth quarter of 2014.

Total commercial/multifamily debt outstanding stood at $2.68 trillion at the end of the first quarter. Multifamily mortgage debt outstanding rose to $989 billion, an increase of $20.6 billion, or 2.1 percent, from the fourth quarter of 2014.
- See more at: http://www.worldpropertyjournal.com/real-estate-news/united-states/mortgage-bankers-association-commercial-mortgage-debt-outstanding-2015-multifamily-debt-outstanding-in-2015-commercial-mortgage-backed-securities-cmbs-cdo-abs-gse-mbs-9167.php#sthash.OX0NZFsb.dpuf

Read more...U.S. Commercial, Multifamily Mortgage Debt Reaches $40.4 Billion in Q1 - WORLD PROPERTY JOURNAL Global News Center

Multifamily Developers Counting on Demand Through 2017 via National Real Estate Investor

Developers planning new apartment buildings today won’t finish for two years or more in many parts of the country—hundreds of thousands of apartments now under construction have already softened the national multifamily markets. But many developers are now planning new projects anyway.

“It’s kind of late in the party, when all the punch is gone,” says Ryan Severino, senior economist and associate director of research for Reis Inc., a New York City data firm. “We always end up overdeveloping.”

Read more...Multifamily Developers Counting on Demand Through 2017 | Multifamily content from National Real Estate Investor

Macro Forecast Report States Apartment Vacancy Expected to Tick Up as More Units Come Online via MultifamilyBiz.com

DTZ, a global leader in commercial real estate services, announced the release of its U.S. Macro Forecast, which predicts positive economic results for the second half of 2015 after a shaky start.

A weakened global economy, a plunge in energy investment, a soaring U.S. dollar and another difficult winter in many U.S. regions took their toll on growth, but real gross domestic product (GDP) still managed to grow 2.7% year-over-year as of the first quarter, a rate that is high enough to sustain commercial real estate demand drivers. Also, job growth is at its highest point in 15 years, and 30% of the new jobs created to date in 2015 were in office-using sectors, with the bulk in professional and technical services. Though the current growth cycle has its inconsistencies, it could surpass the 10-year cycle that spanned from 1990 to 2000, which marks the longest expansion post World War II.

Read more...Macro Forecast Report States Apartment Vacancy Expected to Tick Up as More Units Come Online | MultifamilyBiz.com

ALN Monthly Newsletter June 2015 via ALN Apartment Data

ALN Data just released their May 2015 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 must read from a great provider of apartment data.

Read more...ALN Monthly Newsletter June 2015 via ALN Apartment Data

Monday, June 15, 2015

Rents Jump 6.5% in May via Multifamily Executive

Three months in, it seems like peak leasing season has gotten off to a good start for landlords across the country, and the cries of doom and gloom for 2015 have abated.

In data released yesterday, MPF Research reports that rental rates jumped 6.5% in May, which breaks the previous April high for this cycle.

Read more...Rents Jump 6.5% in May

Dallas metro area ranks 3rd in nation among 'The Best Big Cities for Jobs 2015' via Dallas Business Journal

The Dallas-Plano-Irving metropolitan area is the third best metro area in the nation for jobs this according, according to Forbes’ “The Best Big Cities for Jobs 2015” listing recently published.

Dallas finished just ahead of fourth-place Austin, while Houston came in at No. 6.

Leading the ranking was the Silicon Valley area metro areas of San Franciso-Redwood-South San Francisco at No. 1 and the San Jose-Sunnyvale-Santa Clara metro area at No. 2.

Read more...Dallas metro area ranks 3rd in nation among 'The Best Big Cities for Jobs 2015' - Dallas Business Journal

Friday, June 12, 2015

MPF: Houston multifamily trends 1Q 2015 via Real Estate Center at Texas A&M

Houston’s apartment market was surprisingly slow to generate momentum following the recession. But in mid-2011, Houston’s economy entered into a boom period and the apartment market quickly responded.

Massive numbers of new jobs generated very healthy housing demand, pumping up apartment occupancy rates and rent growth levels in areas with high employment concentrations.

The result for the metro overall has been stabilized occupancy above pre-recession highs and consistently strong rent change performances.

Read more...MPF: Houston multifamily trends 1Q 2015 via Real Estate Center at Texas A&M

Urban Institute: Rental surge to drop homeownership rate to 61.3% by 2030 via HousingWire

The Urban Institute’s Housing Finance Policy Center just released a major new longitudinal study of expected household formation and homeownership rates from 2010 to 2030.

The paper predicts that the homeownership rate will continue to decline through 2030 and that a major rental surge is upon us, a surge the United States is not truly prepared to meet.

Most concerning, they forecast the homeownership rate to drop to 61.3% by 2030.

Read more...Urban Institute: Rental surge to drop homeownership rate to 61.3% by 2030 | 2015-06-12 | HousingWire

Market Snapshot: Austin Multi-Family Winning! via Commercial Property Executive

Forbes placed Austin on the 19th position on the list with best places for business and careers, right after San Francisco. Its major industries—technology, pharmaceutical, and biotechnology—attract every day hundreds of people to relocate in the metro, heightening demand for housing in a market where inventory is scarce.

According to data provided by Marcus & Millichap, employers created 7,000 job openings in the first quarter of 2015, while more than 29,000 people were hired in the past 12 months. This is a 3.3 percent increase from the previous year. 8,100 positions were opened in professional and business services industries, followed by trade, transportation, and utilities with 5,600 jobs added to the market. By the end of 2015, 30,500 new jobs are estimated to be created in the metro.

Read more...Market Snapshot: Austin Multi-Family Winning! | Commercial Property Executive

Who Heads Top 10 Markets for Multi-Family Supply? via Commercial Property Executive

Several markets in the United States recorded outsize multi-family completions during the past year with West Houston and Denver leading with the highest number of units finished, according to a survey by Yardi Matrix.

West Houston saw 22,087 units completed in the past 12 months while Denver had 15,695 completed, according to the survey. Austin followed with 12,826; Washington, D.C., with 12,150; Seattle with 11,202; North Dallas with 10,435; the Carolina Triangle in North Carolina with 9,763; Northern Virginia with 9,072; Urban Atlanta with 8,516 and Charlotte with 8,473.

Read more...Who Heads Top 10 Markets for Multi-Family Supply? | Commercial Property Executive

Monday, June 8, 2015

Is the rental crisis bringing down housing? via HousingWire

Lack of income. Low savings accounts. Changing housing demographics. All of these are creating a bad recipe for housing right now. Plus, the future ahead doesn’t look much better, with a lot more people renting and fewer affordable homes becoming available. Per The Wall Street Journal:

And the latest problem: Policy makers in Washington don’t appear to care or are unaware of the growing issues.

J. Ronald Terwilliger, chairman emeritus and retired CEO of Trammell Crow Residential, recently posted a blog on HousingWire pushing the candidates of both political parties to start speaking to the severe and growing problems in housing.

Read more...Is the rental crisis bringing down housing? | 2015-06-08 | HousingWire

Market Snapshot: Austin Apartments In Demand via Multi-Housing News Online

Forbes placed Austin on the 19th position on the list with best places for business and careers, right after San Francisco. Its major industries—technology, pharmaceutical and biotechnology—attract every day hundreds of people to relocate in the metro, heightening demand for housing in a market where inventory is scarce.

According to data provided by Marcus & Millichap, employers created 7,000 job openings in Q1 2015, while more than 29,000 people were hired in the past 12 months. This is a 3.3 percent increase from the previous year. 8,100 positions were opened in professional and business services industries, followed by trade, transportation and utilities with 5,600 jobs added to the market. By the end of 2015, 30,500 new jobs are estimated to be created in the metro.

Read more...Market Snapshot: Austin Apartments In Demand | Multi-Housing News Online

Friday, June 5, 2015

Austin Economic Indicators June 2015 via Dallas Fed

The Austin economy accelerated in April. Jobs grew at a rapid 7.7 percent annualized rate, far above the 1 percent growth for the state overall. The unemployment rate declined as well and is nearly a full percentage point below the state’s 4.2 percent. Austin has thus far seen few negative effects from the energy slowdown. Year to date, jobs have grown above the long-term trend and faster than in any other major metropolitan area in the state. However, weakness in the Austin Purchasing Managers Index suggests continued sluggishness in regional manufacturing.

The Austin Business-Cycle Index picked up to an annualized pace of 9.7 percent over the six months ending in April. Propelled by strength in fourth-quarter retail sales and wage growth, the index is now expanding at its fastest six-month pace since the recession. Further declines in the unemployment rate and strong job growth du

Read more...Austin Economic Indicators June 2015 via Dallas Fed

Wednesday, June 3, 2015

Investors Sees Opportunity in Workforce Housing Shortage via CoStar Group

For investors, the growing shortage of affordable rental housing in the U.S. is becoming a more tempting target. Turner Impact Capital (TIC) this week announced it has launched the Turner Multifamily Impact Fund with plans to acquire and manage up to $1 billion in apartment communities located in urban markets.

Managers of the new fund will identify and evaluate potential investment opportunities with a focus on acquiring, improving and preserving workforce housing, which it defined as properties with residents earning up to 80% of area median income. The fund is hoping to buy apartment properties where teachers, police officers, health care workers, service workers and others with similar income levels live, a niche market comprising those who earn too much to qualify for subsidized housing, but not enough to afford higher-cost apartments or home ownership in the communities close to where they work.

Read more...Investors Sees Opportunity in Workforce Housing Shortage - CoStar Group

Dallas Beige Book June 3, 2015 via Dallas Fed

The Eleventh District economy grew at a slightly slower pace over the past six weeks than in the previous report. Manufacturers mostly reported steady or weaker demand. Retail sales rose at a weaker-than-expected pace but auto sales were generally strong. Demand for nonfinancial services improved, and real estate activity generally remained solid. Loan demand rose at a slower pace than in the prior reporting period. The energy sector continued to decline, while rainfall notably improved District agricultural conditions. Price pressures remained subdued and employment held steady or increased. Outlooks were mostly positive, but weaker in a few sectors compared with the prior report.

Read more...Dallas Beige Book - Dallas Fed

Fannie Mae, Freddie Mac Approach Multifamily Lending Caps via Property Management Insider

Less than halfway through 2015, Fannie Mae and Freddie Mac are approaching their $30 billion annual lending limit. Because these government-sponsored entities are by far the biggest multifamily lenders, reaching the limit so early in the year would alter the industry’s capital sources for the rest of 2015 and potentially early 2016. The limit was established by the Federal Housing Finance Agency in 2013 to limit GSE exposure to multifamily lending and allow private capital to expand their market share.

As of April 2015, Fannie Mae led new multifamily loan production at $14.9 billion, while Freddie Mac registered new volume of $14.3 billion. Remarkably, these volumes are up 231% for Fannie Mae and 266% for Freddie Mae during the same period in 2014. At this rate, both GSEs would reach their limit for 2015 by the end of 3rd quarter.

Read more...Fannie Mae, Freddie Mac Approach Multifamily Lending Caps | Property Management Insider

U.S. Apartment Rents Surge Again in May – Topping April’s Record via Property Management Insider

U.S. apartment rental rates jumped 6.5% in May 2015 – breaking the previous high for this cycle set just one month earlier. Momentum was seen in rents for both new residents and for renewing renters, up 8.4% on new leases and 5.1% on renewals.

The May numbers mark three straight months of better-than-expected rent growth to start 2015’s peak leasing season. The results have been especially impressive given widespread industry expectations of slowed rent growth in 2015 due to increased new supply and affordability barriers, among other factors.

Read more...U.S. Apartment Rents Surge Again in May – Topping April’s Record | Property Management Insider