Apartment Developer Keep Building, Despite Fears of More Rent Control Laws via NREI

In spite of fears surrounding the expansion of rent control laws throughout the nation, developers in some of the biggest U.S. apartment markets haven't pulled back on new projects.

“These laws alone probably won’t slow down new construction,” says John Sebree, senior vice president and national director of Marcus & Millichap’s national multi housing group, based in Chicago. “However, these new rent control laws will do absolutely nothing to resolve the shortage of housing.”

Read more...Apartment Developer Keep Building, Despite Fears of More Rent Control Laws via NREI

Yardi: National Average Rent Falls $1 to $1,463; Rent Growth Steady at 3% via Multifamily Executive

The national average rent fell by $1 in January 2020, down to $1,463, while year-over-year rent growth has remained at 3%, according to the latest Yardi Matrix Multifamily National Report. January marks the third consecutive month of declines for the average U.S. rent, which Yardi Matrix attributes to seasonality and expects to continue for a few more month

Read more...Yardi: National Average Rent Falls $1 to $1,463; Rent Growth Steady at 3% via Multifamily Executive

Workers’ pay is rising faster in Dallas than the rest of the U.S. via Dallas Morning News

A rising economic tide is lifting workers’ pay, especially in Dallas County.

Private sector workers in Dallas saw average wages rise by 5.1% in the 12 months ended in September, according to newly released federal data. It was the biggest increase for the period since 2016, and Dallas County’s rise surpassed the average gain for the rest of the country.

That’s a reverse of recent trend. In four of the previous five years, wage growth in Dallas County had lagged increases nationwide.

Read more...Workers’ pay is rising faster in Dallas than the rest of the U.S. via Dallas Morning News

Is the Multifamily Asset Class Immune to Economic Shifts? via NREI

Most agree the real estate recovery post-recession has been lengthy and that multifamily has performed well across all stages of our current, mature cycle. At various points in time over the last decade, the other commercial real estate classes haven’t all fared as well as apartments, however.

This begs the question. Are apartments counter-cyclical and immune to economic shifts that negatively impact other types of real estate? Will multifamily maintain its position as the darling of the industry?

Read more...Is the Multifamily Asset Class Immune to Economic Shifts? via NREI

What Lenders Are Thinking as Multifamily Evolves via GlobeSt

Recently the Federal Housing Finance Agency created a new group with the goal of ensuring that both Fannie Mae and Freddie Mac foster a competitive, liquid and resilient multifamily market. “By creating a new group, it speaks to a commitment and dedication to focus on affordability in multifamily,” according to Siobhan Kelly, associate director for multifamily at the FHFA.

Read more...What Lenders Are Thinking as Multifamily Evolves via GlobeSt

The Future of Multifamily Investment via Multi-Housing News Online

Multifamily investment is exploding across the South and Western United States, particularly in suburban areas of Atlanta, Dallas and Phoenix, where garden apartments are plentiful. Mid- and high-rise multifamily assets are also selling in Manhattan, Seattle and Los Angeles, but Integra Realty Resources’ 2020 Viewpoint Multifamily Report notes that tertiary markets are the biggest beneficiaries of the search for yield.

“There is continued optimism, rent growth and investor interest in the multifamily sector, particularly in tertiary markets,” IRR CEO Anthony Graziano told Multi-Housing News.

Read more...The Future of Multifamily Investment via Multi-Housing News Online

Renewal-Lease Rent Growth Holds Steady via RealPage

Apartment rents climbed 4.5% during the past year for households who stayed in place at initial lease expiration. Renewal-lease rent growth now has stayed a little under the 5% mark for three consecutive years, after price inflation came in at higher levels during 2014 and 2015.

Rents are continuing to climb faster for renewal leases than for leases where a new resident is renting at a property for the first time. That new-resident annual rent growth has been running around the 3% mark since late 2016, specifically registering at 2.8% as of the end of 2019.

Read more...Renewal-Lease Rent Growth Holds Steady via RealPage

Top Markets for Rent Growth Shuffle in January via RealPage

The U.S. apartment market started 2020 in better occupancy shape than it did any other year in nearly two decades.

U.S. apartment occupancy hit 95.5% last month, the best January occupancy rate since the early 2000s. That rate was down somewhat from a 20-plus-year high of 96.3% achieved in August. But occupancy typically softens in winter, as many renters opt not to move in the coldest months.

Read more...Top Markets for Rent Growth Shuffle in January via RealPage

Investors Want to Place Capital Before the Next Recession via GlobeSt

Investors are anticipating the next downturn, but rather than taking their chips off the table, investors are looking to place capital this year before the next recession. According to an investor sentiment report from RCM LightBox, investors are looking to place capital in the first half of the year and before the November election.

Read more...Investors Want to Place Capital Before the Next Recession via GlobeSt

New Housing Starts Spike in December via RealPage

Total housing starts across the U.S. hit a record high in December. Multifamily starts haven’t reached current levels in more than 30 years and single-family starts are at a 13-year high, according to U.S. Census figures.

The seasonally adjusted annual rate for annual multifamily starts rose 32% from last month and 74.6% from year-ago figures (to 536,000 units). Single-family starts climbed 11.2% from the previous month and 29.6% above year-ago figures (1,055,000 units). Together, total residential starts rose almost 41% above 2018’s pace of 1.61 million units.

Read more...New Housing Starts Spike in December via RealPage

Freddie Mac Survey Profiles Renters vs. Owners via Multi-Housing News Online

A new Freddie Mac survey profiling renters and owners finds that an unprecedented number of renters—84 percent—believe renting is more affordable than owning, an all-time high for the survey and up 17 percentage points from two years ago. The number is even higher for Baby Boomers surveyed with 87 percent reporting renting is more affordable than owning, up 6 percent from last year.

Despite those numbers, the survey may be raising alarm bells about the impact of rising housing costs for many renters’ budgets as 42 percent of renters reported paying more than one-third of their income for rent, up 8 points from April 2019.

Read more...Freddie Mac Survey Profiles Renters vs. Owners via Multi-Housing News Online

San Antonio Multifamily Report – Winter 2020 via Multi-Housing News Online

San Antonio’s multifamily market continued to benefit from sustained population and employment growth through 2019’s second half. Following robust supply for the better part of this cycle, the metro recorded a sharp deceleration in deliveries during 2019. This has helped keep demand in check, with rents going up 2.1 percent to $1,050 year-over-year as of November 2019. On the other hand, a consequence of the metro’s long-term strong pipeline is a descending occupancy rate in stabilized assets—93.0 percent as of October, down 20 basis points over 12 months and one of the lowest across all major national metros.

Read more...San Antonio Multifamily Report – Winter 2020 via Multi-Housing News Online

Houston Multifamily Report – Winter 2020 via Multi-Housing News Online

Metro Houston gained 82,800 jobs in the 12 months ending in September 2019, with the professional and business services sector accounting for nearly one-third of the total. Manufacturing and construction rounded out the top three, gaining a collective 25,600 positions. The latter is likely to get another boost from one of the largest infrastructure projects in the country. Texas Central has signed a design-build contract with the joint venture of Salini Impregilo and Lane Construction Corp. for a high-speed rail line connecting Houston and Dallas. The team aims to kick off the project this year, with the total civil works investment expected to exceed $14 billion.

Read more...Houston Multifamily Report – Winter 2020 via Multi-Housing News Online

ALN Monthly Market Stats February 2020 via ALN Apartment Data

ALN Data just released their January 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 February 2020 via ALN Apartment Data

Takeaways from the MBA CREF 2020 Conference, Day One via NREI

This week kicked off the annual Mortgage Bankers Association/Commercial Real Estate Finance conference in San Diego. Among the hot topics discussed during Monday’s panel sessions were the rising volume of collateral debt obligations (CLO), the impact of rent regulations on multifamily lending and whether proptech is going to make commercial mortgage bankers obsolete. Here are some takeaways from Monday’s discussions:

Read more...Takeaways from the MBA CREF 2020 Conference, Day One via NREI

Investors Still Willing to Pay Top Dollar for Multifamily via GlobeSt

Multifamily acquisition yields and price per unit have hovered at record lows for several years despite Treasury yields moving up and down by more than 150 basis points during that time. What does that mean for pricing? Yardi Matrix spells it out in its newest report on the asset class: it means investors are willing to pay up even as market conditions change. The average price per unit in 2019 was $155,000, up 8.8% from 2018, it notes.

Read more...Investors Still Willing to Pay Top Dollar for Multifamily via GlobeSt

Dallas Multifamily Report – Winter 2020 via Multi-Housing News Online

Adding residents three times faster than the nation and sporting the largest multifamily pipeline in the U.S., Dallas-Fort Worth remained one of the country’s most dynamic yet stable rental markets. And despite the addition of more than 45,000 apartments since the beginning of 2018, the Metroplex’s occupancy rate in stabilized assets dropped just 10 basis points over 12 months, to 94.3 percent as of October 2019.

Read more...Dallas Multifamily Report – Winter 2020 via Multi-Housing News Online

MBA Predicts Slow Economy, Stable Rates via Multi-Housing News Online

This will be a year of slow GDP growth (roughly 1.2 percent) and interest rates will stay in pretty tight range of where they are today. That was the big economic picture offered by the Mortgage Bankers Association CREF/Multifamily Housing Convention & Expo 2020 conference in San Diego.

According to Michael Frantantoni, MBA’s chief economist, the projected slowdown (GDP last year was 2.2 percent) is not surprising for an economy that has been so robust for so long. But there are so many more uncertainties this year.

Read more...MBA Predicts Slow Economy, Stable Rates via Multi-Housing News Online

Some Markets See Big Shifts in Rent Growth in 2019 via RealPage

While rent growth in the U.S. overall didn’t see much change throughout 2019, a handful of markets charted notable momentum in the past year.

After hovering at or above the 3% mark for all of 2019, annual rent growth for new leases in U.S. apartments faded to 2.8% right at the end of the year. That rate was 50 basis points (bps) behind the 3.3% increase in calendar 2018.

Read more...Some Markets See Big Shifts in Rent Growth in 2019 via RealPage

Gen Z Residents Reshape Multifamily Operations via Multi-Housing News Online

The letter “Z” may be the last in the alphabet. But for multi-housing builders and managers, it signals the start of a new era in which young adults born since the mid-1990s will begin occupying their apartments, if they haven’t already.

They’re called Generation Z, or GenZ for short, and they’re totally different from the population cohorts that preceded them—even Millennials. And apartment professionals need to take notice. If for nothing else, they account for a third of the U.S. population and contribute $44 million to the economy.

Read more...Gen Z Residents Reshape Multifamily Operations via Multi-Housing News Online

Kingsley: National Renter Satisfaction Levels Out in Q4 2019 via Multifamily Executive Magazine

National renter satisfaction started to level out at the end of 2019, ending the steady increase that began at the end of 2017. This past quarter, 78.4% of residents reported “Good” or “Excellent” satisfaction with their overall renting experience. The past two quarters have each seen a slight decrease of 0.1 percentage points, indicating the two-year upward trend is leveling out.

Read more...Kingsley: National Renter Satisfaction Levels Out in Q4 2019 via Multifamily Executive Magazine

Harvard Report: Higher-Income Households Driving Rental Demand via Multifamily Executive Magazine

The nation’s affordability crisis is not just affecting the lowest bracket of renter households, it’s climbing the income ladder to impact more modest-income households, according to the “America’s Rental Housing 2020” report by Harvard’s Joint Center for Housing Studies (JCHS).

“Ultimately, we are in a rental affordability crisis,” says Whitney Airgood-Obrycki, a research associate at the JCHS. “We have seen another worsening of the affordability crisis this year, evident in the rising cost-burdened numbers as well as the increasing numbers of people experiencing homelessness.”

Read more...Harvard Report: Higher-Income Households Driving Rental Demand via Multifamily Executive Magazine

Texas Economy Building Momentum to Start Year via Dallas Fed

Growth in the Texas economy picked up at year-end 2019 and accelerated into January, according to the Texas Business Outlook Surveys (TBOS). Job gains in December were led by service sector growth, adjusted Bureau of Labor Statistics payroll employment data showed.

Separately, TBOS respondents reported a return to mild expansion in manufacturing at the start of 2020.

The housing industry remained a bright spot, with increased home sales and construction permits, while the oil and gas sector continued to decline. Company outlooks have improved, with Texas business executives optimistic about activity in 2020.

Read more...Texas Economy Building Momentum to Start Year via Dallas Fed

DFW led the nation’s metro areas in job creation in 2019 via Dallas Morning News

Dallas-Fort Worth led the nation’s metropolitan areas in job creation in 2019, marking the region’s third straight year topping the charts.

New, relocating and expanding businesses in North Texas created 127,600 jobs during the year, according to new data from the U.S. Bureau of Labor Statistics. That total bested New York and Los Angeles, which both added fewer than 100,000 new jobs.

Read more...Dallas-Fort Worth led the nation’s metro areas in job creation in 2019 via Dallas Morning News

Economic Fundamentals for Real Estate Remain Solid via Nareit

The economic fundamentals for commercial real estate were solid through the end of 2019. The economy continued to grow at a moderate rate, with a 2.1% annualized increase in GDP in the fourth quarter that matched the pace of expansion in the third quarter. The economy still has considerable scope to continue growing, in large part because labor markets are not nearly as tight as a 3.5% unemployment rate, the lowest since 1969, would suggest.

Read more...Economic Fundamentals for Real Estate Remain Solid via Nareit

A New Study Explores Rental Housing Cost in DFW (Spoiler: It’s Going Up) via D Magazine

Dallas-Fort Worth’s most affordable rental housing stock took a major hit during the decade ending in 2018 but made gains in more expensive apartments. Meanwhile, the region quadrupled in rentals that cost more than $1,400 a month, according to a new study from Harvard’s Joint Center for Housing Studies.

The metro area lost 238,000 rental units priced below $800 a month over the decade. The region added 110,000 units costing between $800 and $1,000 a month. It had just 64,000 units at $1,400 or more in 2008; today, there are 263,000.

The study’s five brackets breakdown like this:

Read more...A New Study Explores Rental Housing Cost in DFW (Spoiler: It’s Going Up) via D Magazine

NMHC Survey Indicates Mixed Multifamily Conditions via Multi-Housing News Online

Rent control laws in New York along with a lack of available deals and seasonal decline are among reasons cited in the NMHC Quarterly Survey of Apartment Market Conditions as possibly contributing to lower multifamily sales volumes in some markets.

The survey was conducted from Jan. 21 through Jan. 28 with 78 CEOs and other senior executives from apartment-related firms responding. The Sales Volume Index decreased from 46 to 43 with 28 percent of survey respondents reporting lower sales volume than three months prior.

Read more...NMHC Survey Indicates Mixed Multifamily Conditions via Multi-Housing News Online

Multifamily Investors Are on the Hunt in 2020 via GlobeSt

Buyers will be out in force in 2020. That was the emphatic message delivered by attendees who took our annual survey at the GlobeSt. Apartments Conference in Los Angeles late last year. In 2018, just 19% of the respondents to the annual Capital One survey said they anticipated primarily being buyers during the following year. In fall 2019, 74% declared their intention to focus on adding to their holdings.

There are multiple reasons for the pendulum to have swung so abruptly.

Read more...Multifamily Investors Are on the Hunt in 2020 via GlobeSt

The Cities with the Greatest Rent Jumps in the Past Decade via NREI

Apartment rents have risen steadily across the country and while most people know that the cities with the most expensive rents include markets in the Bay Area and New York City, those markets did not see the largest growth on a percentage basis in the past decade.

That's according to a recent analysis by PropertyClub, an apartment rental listing service.

Using data from Zillow, PropertyClub measured the 100 most populated cities in the U.S. and found the greatest percentage difference in median rents from 2010 to 2019.

Read more...The Cities with the Greatest Rent Jumps in the Past Decade via NREI

Top U.S. Multifamily Markets of the Decade via Arbor Realty Trust

The 2010s decade began in the wake of one of the deepest housing downturns the country had ever seen, amid a global financial crisis, and ended with uncertainties surrounding a trade war with China and accelerated climate change.

There was also a massive demographic shift previously unseen in the country. Baby boomers entered into retirement and millennials came of age.

Over the course of the decade, the multifamily real estate market emerged as a premier asset class.

Read more...Top U.S. Multifamily Markets of the Decade via Arbor Realty Trust

'Texas Expansion Likely to Continue,' in 2020, Says Dallas Fed Economist via Dallas Fed

Texas employment is forecast to grow about 2.1 percent in 2020, said Federal Reserve Bank of Dallas assistant vice president and senior economist Keith Phillips today in San Antonio.

The forecast means Texas should add about 274,000 jobs in 2020. State employment grew at 2.0 last year, adding approximately 254,100 jobs.

Read more...'Texas Expansion Likely to Continue,' in 2020, Says Dallas Fed Economist via Dallas Fed