Posts Tagged ‘Rent Growth’

Top Markets for Expected Rent Growth in 2017

Written by Landlord Property Management Magazine on . Posted in Blog

Shared Post from Multifamily Executive | By

rentgrowth2

California once again dominates the list of rent-growth leaders for the coming year, with more than half of the top markets, but it may come as a slight surprise to some.

Oakland tops the list, with San Francisco and San Jose still in the top 10. Oakland’s rent-growth pace has slowed significantly recently, and San Francisco and San Jose are both experiencing rent cuts. There’s been a lot of fear about oversupply in these markets, which could be contributing to the current situation. The Bay Area economy has experienced a notable decline recently, but its job-addition volumes are substantial.

“[Apartment operators] will pretty quickly realize that the [Bay Area] market hasn’t gone off the edge of the cliff, regaining some confidence on pricing power,” says Greg Willett of MPF Research.

The continued above-average growth in these California markets is good news for business, but it’s squeezing renters more than ever. A one-bedroom unit in San Francisco in October rented for $3,373, on average, which is slightly more than half the area median income monthly paycheck after taxes, according to real estate listing site Rent Jungle.

Las Vegas is the second rent-growth leader for next year, at 6.1%, just behind Oakland. The metro was hit hard by the recession but has experienced improved growth in the past 18 months that makes it a great market going forward. Seattle; Dallas; Nashville, Tenn.; and West Palm Beach, Fla., are the other markets defined as rent-growth leaders for the coming year.

Absent from 2016 are Portland, Ore.; Fort Worth, Texas; Atlanta; and Phoenix, which all are expected to come in just under the cutoff of 4%.

Forecast Rent Growth Leaders in 2017

Rank (MetroForecast Rent Growth)

Oakland                                                     1 (6.5%)

Las Vegas                                                  2 (6.1%)

San Francisco                                           3 (5.7%)

Sacramento                                               4 (5.6%)

Seattle                                                         5 (5.4%)

San Jose                                                     6 (4.9%)

Riverside – San Bernardino                      7 (4.5%)

Dallas                                                          8 (4.4%)

Nashville                                                    8 (4.4%)

West Palm Beach                                       8 (4.4%)

Los Angeles                                              11 (4.3%)

San Diego                                                  11 (4.3%)

Fort Lauderdale                                       13 (4.2%)

Kayla Devon

Kayla Devon is an associate editor for Hanley Wood’s residential construction group. She covers business, products, and technology for both Builder and Multifamily Executive magazines. Find her on Twitter: @KaylaDevon_HW

In the Bay Area’s Shadow, Santa Rosa/Petaluma’s Apartments Post Big Gains [Video]

Written by Landlord Property Management Magazine on . Posted in Blog

by Jay Parsons

A smaller coastal market just north of San Francisco, Santa Rosa/Petaluma quietly emerged as the top-performing apartment market of 2013. Santa Rosa/Petaluma led the nation’s core 100 metros with rent growth north of 10%, while ranking #2 for overall occupancy.

Santa Rosa/Petaluma Performance Highlights Q4 2013

The Big Three Bay Area apartment markets get plenty of attention from multifamily and real estate circles, and rightfully so. But don’t forget about outlying metros like Santa Rosa/Petaluma, where apartment market fundamentals are among the best in the nation.

Santa Rosa/Petaluma has been flying below the radar and quietly outperforming the combined performance of the Bay Area apartment markets over the past year. On top of that, Santa Rosa led the top 100 apartment markets in year over year rent growth for 2013 with 10.6%.

The impressive rent growth comes at occupancy rates remain sky high. Occupancy as of Q4 measured 97.8%, second best for 2013 among the top 100 apartment markets.

While maintaining double digit rent growth seems unlikely, the Santa Rosa/Petaluma apartment should continue to do very well thanks to solid economic growth and minimal apartment construction. And as long as the larger, more expensive Bay Area apartment markets continue to do well, Santa Rosa/Petaluma should be well positioned to capture the overflow effect on the outskirts.

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