As Expected, Multifamily Market Returning to Normal in 2018 via Property Management Insider

A year ago, the consensus among multifamily leaders was that 2017 would be a tale of a storybook market cooling its heels. By last fall, analysts observed that a slowdown was already underway and would continue into the next year.

Issues with affordability and funding loomed, as did price flattening due to a shake-up in the mix of demand and product supply. Developers would be forced into a more selective approach as lending tightened, they said.

Read more...As Expected, Multifamily Market Returning to Normal in 2018

Rents Catch Up with Incomes in Y-O-Y Growth via GlobeSt.com

Renters’ incomes had been growing faster than rent checks for the past year or so, but now the latter are catching up again. Zillow said Thursday that median rents for both apartments and single-family rentals grew 2.4% nationally for the 12 months that ended Nov. 30 to reach $1,435 per month, the highest median rent the firm has reported to date.

That’s nearly in line with the 2.5% annual growth in incomes during the same month, says Zillow senior economist Aaron Terrazas. November represents the first month since June 2016 in which rent growth increased at the same pace as incomes.

Read more...Rents Catch Up with Incomes in Y-O-Y Growth | GlobeSt.com

Will the Tax Bill Prove Too Much of a Good Thing for the CRE Industry? via National Real Estate Investor

In a first major legislative victory for the Republican Party since President Trump took office, the House and Senate have passed the Tax Cuts and Jobs Act. The $1.5 trillion bill marks the first major overhaul of the U.S. tax code since 1986 and is expected to be a great boon for commercial property owners. Industry analysts predict the new tax code will strengthen demand in the multifamily sector and spur corporations to put more money into real estate assets and new development, in addition to preserving or improving most of the existing tax breaks for real estate investors.

Read more...Will the Tax Bill Prove Too Much of a Good Thing for the CRE Industry? | National Real Estate Investor

Rental Homes Demand Is Starting To Ease via GlobeSt.com

The multifamily housing market has been exhibiting nothing but prolific growth over the past decade. Now as 2017 comes to a close it is becoming apparent that this growth is starting to slow, according to a report from the Joint Center for Housing Studies of Harvard University. As the dust settles from this era, it is also apparent that the rental housing market has changed considerably and perhaps permanently, the report concluded.

In short, the apartment market is settling into a “new normal” in which nearly 21 million households pay more than 30% of their income for rent.

Read more...Rental Homes Demand Is Starting To Ease | GlobeSt.com

Renting in Dallas: 2017 Year in Review via CandysDirt.com

A new report from Apartment List analyzes the top trends in the 2017 rental market and predicts their impacts in 2018. For example, the report highlights the increase in the homeownership rate after a decade of declines, as well as the decrease in the share of rental units considered affordable to the lowest-income renters. Although affordability remains a concern for those renting in Dallas, Dallas rent growth slowed as the metro added more new rental stock than any other U.S. metro. Dallas rents remain slightly lower than the national average, at $1,100 for a two-bedroom apartment, compared to $1,160 nationwide.

Read more...Renting in Dallas: 2017 Year in Review - CandysDirt.com

D-FW led the country in apartment building permits in October via Dallas News

Slowdown? What slowdown?

Apartment builders and analysts have been predicting a slowdown in new rental projects. Early this year it looked like starts were beginning to wane. But new numbers show that Dallas-Fort Worth apartment building has increased more than 14 percent this year.

Read more...D-FW led the country in apartment building permits in October | Real Estate | Dallas News

Multifamily Permits Are Plateauing via GlobeSt.com

On a metro area basis, a few individual cities in the top 10 markets for apartment permits posted impressive year-over-year gains in October. On the whole, though, permit totals are plateauing, says RealPage.

Citing Census Bureau data, RealPage says local governments across the country approved 416,000 apartment units in the year-ending Oct. 31. That permitting activity, including 40,087 units authorized during the month of October, represents a 13.4% increase over September’s annual volume—which was down 17.4% from the previous month—and a 12.2% decline from October 2016’s annual total.

Read more...Multifamily Permits Are Plateauing | GlobeSt.com

ALN Monthly Market Stats December 2017 via ALN Apartment Data

ALN Data just released their November 2017 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 December 2017 via ALN Apartment Data

Public Housing Under Pressure via Housing Finance Magazine

Every year for more than a decade, the federal budget has provided much less than housing authorities need to manage and maintain their public housing properties. Across the country, public housing crumbles amid billions of dollars of deferred maintenance ranging from peeling paint to leaky roofs.

Federal officials also continue to pile on reporting and compliance mandates that don’t make sense for smaller housing authorities, which simply don’t have the staff to keep up.

And the most-recent proposed reform of the federal tax code might wipe out an important funding program that has—until now—helped many housing authorities repair their tattered buildings and improve their funding situation.

Read more...Public Housing Under Pressure| Housing Finance Magazine | Public Housing, LIHTC, Research

Diverse Opportunities Draw Tech Workers to DFW via GlobeSt.com

Buoyed by double-digit tech-sector employment growth, Dallas-Fort Worth was among the top US markets for rising office rents during the past two years, according to CBRE’s annual Tech 30 report, which measures the tech industry’s impact on office rents in 30 leading US and Canadian tech markets. Dallas-Fort Worth had the sixth greatest rent growth on the list.

“Dallas-Fort Worth is identified as one of five markets with the greatest growth potential. The depth of a market’s talent pool is even more important to employers than the cost of doing business, and DFW is the largest tech labor market in Texas,” said Jeff Eiting, first vice president, CBRE. “Our large labor pool attracts the tech companies, and tech workers are attracted to the market because of the diverse job opportunities we offer.”

Read more...Diverse Opportunities Draw Tech Workers to DFW | GlobeSt.com

Economy Watch: Apartment Market Fundamentals Beginning to Shift via Multi-Housing News Online

After more than a decade of declines, the U.S. homeownership rate appears to have stopped falling, at least for now, Apartment List Rentonomics recently reported. Should the rate stand pat, or even start to rise, that will have implications for multifamily rental properties.

After years of decreases from the 2004 high of 69.2 percent, the homeownership rate appeared to have bottomed out in the second quarter of 2016, when the rate hit 62.9 percent. That was the lowest homeownership rate since 1965, but was still significantly higher than at the first half of the 20th century—especially before the invention of the 30-year mortgage—when the rate was well under 50 percent.

Read more...Economy Watch: Apartment Market Fundamentals Beginning to Shift

D-FW near the top of the list of markets with the most moves via Dallas News

If you've noticed a lot of out-of-state license plates, there's a reason.

Almost 80,000 people a year are moving to North Texas.

And the Dallas-Fort Worth area ranked second among top markets for moves, according to a new study by Updater.com, an online relocation technology firm.

Read more...D-FW near the top of the list of markets with the most moves | Real Estate | Dallas News

Pipeline Thins Out in Major Apt. Markets via GlobeSt.com

The apartment development pipeline has two main components: units under construction and those in the planning stages. With a total of about 100,000 apartments due to come on line in Dallas, New York City and Atlanta, including 39,400 in Dallas alone, it would stand to reason that there will be many more to follow.

However, RealPage analysis says this isn’t the case. In the case of the three metro areas cited above, there are a little over 23,000 units in the planning stages—i.e. approved by local regulators and scheduled to begin construction within a year.

Read more...Pipeline Thins Out in Major Apt. Markets | GlobeSt.com

Austin Economic Indicators 12/8/17 via Dallas Fed

The Austin economy expanded at a robust pace in October. The Austin Business-Cycle Index continued to grow above its long-term rate, as jobs remained strong and the unemployment rate reached its lowest level since the late 1990s. High-tech employment remained strong in the second quarter. Home affordability rose in the third quarter, while home sales remained steady at a high level.

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

Investor Focus Shifts in Multifamily via GlobeSt.com

Investors in the multifamily sector are turning their gaze outside the urban core. Capital One’s fourth annual survey of investor sentiment, conducted at the RealShare Apartments conference in Los Angeles, found that 43% are looking at secondary/tertiary markets, or more than twice as many as those who saw the greatest potential for value in urban markets, while another 35% said they see the best opportunities in the suburbs. A year ago, a plurality—47% of respondents—cited urban markets as the leading opportunity.

“All signs point to the multifamily sector heating up in 2018,” says Jeff Lee, president of Capital One Multifamily Finance. “Investors are looking to engage in secondary and tertiary markets, where they see increasing opportunity. These markets have seen rent growth, and their broad appeal should generate interest and activity as we head into 2018.”

Read more...Investor Focus Shifts in Multifamily | GlobeSt.com

Yardi: Year-Over-Year Rent Growth Rises to 2.5% Nationwide via Multifamily Executive Magazine

Average U.S. rents fell by $1 in November, down to $1,358, according to Yardi Matrix’s Matrix Monthly survey of 121 markets. This marks the second consecutive month of average rent decline, though Yardi notes that rents are stabilizing at moderate growth levels. The year-over-year rate of rent growth is up to 2.5% nationwide, up 10 basis points over October.

Yardi attributes the slight decline to seasonal factors. It maintains that the overall growth rate is steady despite ongoing new supply growth, affordability struggles in major coastal metros, and rent gain pressures in the Pacific Northwest.

Read more...Yardi: Year-Over-Year Rent Growth Rises to 2.5% Nationwide | Multifamily Executive Magazine

Deal Volume Ticks Upward Even as Pricing Slips via GlobeSt.com

Even as commercial property pricing has ticked downward in recent months, transaction volume has been moving in the opposite direction. Ten-X Commercial said Wednesday that investment activity increased by 3.2% in the third quarter, marking the second consecutive three-month period of quarterly increases.

Read more...Deal Volume Ticks Upward Even as Pricing Slips | GlobeSt.com

Cap Rates Hold their Ground as Interest Rates Move Higher via Nareit

Cap rates have been holding their ground, even as interest rates move higher. The resilience of pricing in the real estate sector should not be surprising, however, given the strength in the fundamentals that support demand for commercial space.

Indeed, real estate markets strengthened further in October, with cap rates reaching new lows for most property types, according to the latest data from Real Capital Analytics. These recent moves continue a downtrend that began in 2010 (chart above)

Read more...Cap Rates Hold their Ground as Interest Rates Move Higher | Nareit

Houston Economic Indicators 11/30/17 via Dallas Fed

Recovery from Hurricane Harvey was evident in October data. Employment bounced back, job ads improved, and leading indexes were neutral to positive for job growth ahead. Taken together, the outlook for Houston is positive.

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