The recent housing crisis and the broader economic climate have led to a strong multifamily real estate market nationwide. DSNews.com reported on Friday that the U.S. can expect at least one more year of expansion in the multifamily housing market, referencing a recent National Apartment Report that said, “the alignment of powerful demographic and economic trends (continue) to fortify nationwide apartment performance.”

The report used forward-looking market indicators, like new home construction activity, employment growth, housing affordability, rent rates, and vacancy rate for its ranking data. It found that the the tightest vacancy rate is in New York, followed by San Jose, California, which enjoyed the dubious distinction last year, with nearby neighbor, San Francisco, holding the No. 2 spot last year. Jacksonville, Florida, ranked last on the list due to its high vacancy rates, which are not expected to improve this year.

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Across the Nation

California markets are doing well, taking up 5 of the top 10 spots on this year’s index. While ranking relatively low on the list, a few Midwest markets are expected to demonstrate marked improvement over the year.

Detroit, Michigan, and Columbus, Ohio, ranked 32 and 33 this year, having moved up six and eight spots, respectively. Both cities owe their improvement to their manufacturing sectors, according to DSNews.

Another notable Midwestern market, Minneapolis, ranked No. 7 this year, while claiming the nation’s third-lowest vacancy rate and fourth-highest job growth.

Austin, Texas; Washington D.C.; and West Palm Beach, Florida, all slipped a few spots on the National Apartment Index this year. All three markets face challenges with supply increases likely this year.

Austin, Texas, fell from the No. 7 spot last year to No. 15 this year. Washington D.C. fell from No. 9 to No. 17, and West Palm Beach, Florida, slid from No. 32 to No. 40.

New construction for residential real estate will introduce about 150,000 new apartment units to the market, while household formation will grow, bolstered by echo boomers and immigrants.

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This is filed under National Markets.


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