4th Quarter 2009 Apartment Vacancy Hits 8%

Reis, Inc., a real estate research firm just released its 4th Split up 2009 apartment vacancy report. As expected, it hit 8%—the summit in thirty years. The poor disorder of the U.S. job market continues to be blamed, as job creation lags behind other positive economic indicators. Young people, who are typically apartment renters, have been hit especially hard in the job market.

A bit extra positive is the news that an always-rising supply of newly built apartment units is starting to decline—irrevocably catching up with the credit crunch that started in the summer of 2008. 28,000 new apartments came on the market in the 4th split up 2009. The total for the year: 120,000, including developments intended for condos that converted to rentals. New apartment supply should reduction by half in 2011, and if jobs improve, there could be some rental market recovery by the middle of this year, according to the report.

The U.S. apartment vacancy rate rose .10 percent from the 3rd split up, and 1.3 percent for the year, ending at 8%. Sunbelt cities like Tucson AZ, and Jacksonville, FL experienced huge vacancy increases in 2009, at 10.5% and 14.4%, respectively. Charlotte, NC and Lexington, KY were also hit hard. Nationwide, vacancies increased in 52 markets, superior in 17, and remained Flat tire tire in 10.

Not only are vacancies higher than always, but landlords are experiencing a double-whammy: both asking and effective rents are plummeting. For 2009, asking rents fell 2.3%, also the largest decrease in thirty years; effective rent fell .7% to $964 per square bottom.

And while mortgage financing has tough up, regime efforts to enhance the housing market threaten apartment owners, as some renters find it simpler to buy a home. In some markets, continued unrest in the housing sector and lower rents will make renting extra striking than buying.

Landlords and rental material goods owners will likely need to pocket up again offering rent reductions, perks and amenities to entice new tenants—until the job market improves. And when that will happen is anyone’s guess.

Reis, Inc., a real estate research firm just released its 4th Split up 2009 apartment vacancy report. As expected, vacancies hit 8%—the summit in thirty years. The poor disorder of the U.S. job market continues to be blamed, as job creation lags behind other positive economic indicators. Young people, who are typically apartment renters, have been hit especially hard in the job market.

A bit extra positive is the news that an always-rising supply of newly built apartment units is starting to decline—irrevocably catching up with the credit crunch that started in the summer of 2008. 28,000 new apartments came on the market in the 4th split up 2009. The total for the year: 120,000, including developments intended for condos that converted to rentals. New apartment supply should reduction by half in 2011, and if jobs improve, there could be some rental market recovery by the middle of this year, according to the report.

The U.S. apartment vacancy rate rose .20 percent from the 3rd split up, and 1.3 percent for the year, ending at 8%. Sunbelt cities like Tucson AZ, and Jacksonville, FL experienced huge vacancy increases in 2009, at 10.5% and 14.4%, respectively. Charlotte, NC and Lexington, KY were also hit hard. Nationwide, vacancies increased in 52 markets, superior in 17, and remained Flat tire tire in 10.

Not only are vacancies higher than always, but landlords are experiencing a double-whammy: both asking and effective rents are plummeting. For 2009, asking rents fell 2.3%, also the largest decrease in thirty years; effective rent fell .7% to $964 per square bottom.

And while mortgage financing has tough up, regime efforts to enhance the housing market threaten apartment owners, as some renters find it simpler to buy a home. In some markets, continued unrest in the housing sector and lower rents will make renting extra striking than buying.

Landlords and rental material goods owners will likely need to pocket up again offering rent reductions, perks and amenities to entice new tenants—until the job market improves. And when that will happen is anyone’s guess.