An update, from the invaluable Calculated Risk
The vacancy rate for the third quarter, which wraps up the prime leasing season, fell to 5.6% from 7.1% a year earlier. That is the lowest since 2006.
The increased demand follows several years that saw little new apartment development. About 8,200 units came online during the third quarter, one of the lowest quarterly figures since Reis began tracking the data in 1999.
Also, tightening supply is not what a recessionary chart looks like. I continue to see the fundamentals pointing towards growth even if we are experiencing strong headwinds right now.
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Thursday ~ October 6th, 2011 at 9:52 am
Benny Lava
Is there any way to get a view of apartment in correlation with their location or region? What I mean is this: there is a lot of evidence that young college educated Americans are moving into cities. This would explain the tight rental market and slack housing market. Most of the last decade’s housing construction was in suburban homes, which face a long term structural demand challenge. I mean I could be off base on this, but one need only look at the boom in urban real estate in New York. The Manhattan boom has spilled out into Brooklyn.
Thursday ~ October 6th, 2011 at 10:39 am
jpersonna
As CR has noted in the past, there was kind of an ebb and flow to apartment rentals as the housing bubble burst. I think you want a measure of total occupancy (or household formation).
BTW, my comment is still stuck on that Man v. Machine article.
Friday ~ October 7th, 2011 at 9:28 am
Barry
“Also, tightening supply is not what a recessionary chart looks like. I continue to see the fundamentals pointing towards growth even if we are experiencing strong headwinds right now.”
Or, many people are forced out of houses/can’t buy, so they’re renting.
Friday ~ October 7th, 2011 at 3:26 pm
Nathanael
There’s an oversupply of single-family exurban houses. There’s still an undersupply of urban apartments. This has been true for two decades plus, and continues to be true. I notice that Benny Lava has made the same point.
This is driven partly by cultural changes (driving is no fun and you can’t use your iPod while doing it), and largely by rising transportation costs (driving costs a fortune, and rising, and rural bus routes are terrible-to-nonexistent).