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      Q4 2015 Apartment Sector First Glance

      Growth Powers Through; Occupancies Decline

      Apartment_Sector_First_Glance-1.jpg

      Attesting to the resilience of demand for multifamily units, national asking rent growth clocked in at 4.6% for all of 2015, while effective rent growth mustered an impressive 4.7%. These figures are stronger than annual rent growth in 2007— the last peak period for rent increases for the sector — and are exceeded only by annual rent growth figures from the 1999-2000 period, when vacancies were even lower than they are today.

      Herein lies the conundrum for apartment properties at this juncture: rent growth is undeniably (for some, surprisingly) strong, despite the concern of pessimists about how average rents are outstripping wage growth in many markets. However, vacancies have begun to increase from recent lows.

      The national apartment sector vacancy rate for the end of 2015 stood at 4.4%, an increase of 10 basis points over the prior quarter. How should we read the tea leaves for multifamily moving forward?

      Get the First Glance Report

       

       

      Topics: Apartment, CRE News & Updates, Vacancy Rates, Articles, Economic Trends, Cap Rates, Rents, Absorption Rates, Occupancy Rates, New Construction, Construction, Multifamily, All