According to Jones Lang LaSalle, or JLL, sales volumes on multifamily housing in the United States shot up about 47% from the months of July to September after a dragging second quarter. Sales volumes on multifamily housing hit about 25 billion dollars during that time.
Researchers cite the housing hangover, population growth in the empty nesters and Echo Boomers, and the rise in households formed for the reason behind this surge in rental apartment demand. The areas where the greatest growth in rental markets has been seen were Los Angeles, District of Columbia, and New York.
Owing to the new tech boom bringing people Westword, Denver also holds one of the top spots in the market based on annual rental housing development growth. Over the course of the last 3 years, roughly 4,1000 units have been absorbed per year. This still does not surpass the reigning leader in rental properties versus homeowners- and that would be Los Angeles. Currently, Orange County boasts a meager 3.6% apartment vacancy rate- meaning, they haven’t seen this many rentals in about 13 years. In Arizona, rental demand is also high. In the capital city, Phoenix, the vacancy rate sits at only about 5.5% and in Portland, Oregon it is nearly non-existent at 2.9%. Currently, the city with the most growth in the US is Seattle, with a 6.2% annual growth in rents. These are just a small sampling of the rental markets that we have seen improving in recent months.
With respect to single family rental homes, there are a few states that investors overlooked but are showing a tremendous amount of growth, themselves. Texas, Oklahoma, New York, Tennessee, Florida, Louisiana, Pennsylvania, Ohio, Missouri, Kansas, Michigan, Maryland, Connecticut, Virginia, Wisconsin and Alabama are all seeing certain counties as a driving force in rental expansions, with more and more people renting homes in those areas.
Daren Blomquist, vice president at RealtyTrac said of these counties and states surveyed that they all had a few things in common- namely, investor purchases making up only 5% or less of the sales during the studied time frame and unemployment rates in those areas staying at or below 7.5%.
Additionally, he stated that, “With this analysis we’ve identified the top overlooked markets where single family rentals still make good financial sense but where there is little to no competition from the big players.”