Multifamily Sector's April Stats Show Recovery's Strengthening
Posted May 29, 2011
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DALLAS - Axiometrics Inc., getting a handle on April's apartment market numbers, predicts the next two years could be stronger than originally projected by industry watchdogs.
"After what we had seen in the first quarter of this year, our April numbers sound a bit like a broken record - effective rents and occupancy rates continue to grow," said Ron Johnsey, president of Dallas-based Axiometrics. "Some markets, though still experiencing solid increases in effective rents, have slowed down a bit, but overall the trend is onward and upward."
Johnsey's team has concluded that the sector is poised to deliver "outstanding returns" in the next 20 months, with effective rent growth and occupancy at near-record highs in a growing number of markets.
According to Axiometrics, effective rents nationwide rose 0.68 percent between March and April and 2.45 percent in the past year. Annual effective rent, though, dipped to 4.96 percent in April from 5.02 percent in March.
Cleveland posted the biggest rent spike, ending April at 6.25 percent versus 3.88 percent at the end of December 2010. Houston and Orange County also climbed in the metro rankings although their overall growth still trails the national average.
Occupancy rose for the 11th time in 15 months, picking up 33 basis points between March and April. The national average stands at 93.81 percent. In all, 10 markets are boasting occupancies of 96 percent or higher, five of which are in Northern California and New York.
The concession side of the equation showed a drop to 4.05 percent from 4.39 percent for April and March, respectively. A value of 8.33 percent factors out to one month's free rent on a one-year lease. The last time there was a lower concession value was September 2008.
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