With demand for apartments remaining strong and new supply levels minimal, occupancy jumped to 92.6%. While not great, it is a jump of 160 basis points in 2013.
Annual rent growth FINALLY showed a little momentum as same store rents climbed 1.9% in 2013, the largest increase seen in Las Vegas since 2007.
Northeast region’s apartment markets ranked among the nation’s rent growth laggards during 2013
Connecticut. Effective rents for new leases in the state proved basically flat, inching up a minor 0.2% on average. Only the New Haven/Waterbury area, where rents jumped 2.6%, registered any real pricing power.
Connecticut realized apartment rent growth of 3% to 4% annually in 2010-2011, basically recovering the losses incurred during the downturn of 2008-2009. Then growth of about 2% in 2012 took rates slightly above pre-recession levels.
Connecticut’s apartment occupancy rate now stands at 95.0%
Apartment demand in Boston fell short of rapidly rising supply levels in 2013
With supply outpacing demand, occupancy is understandably down in Q4 2013. That said, the 96.3% occupancy rate is still healthy for the metro as a whole and across submarkets and product groups.
The bigger issue for Boston is pricing. Same store rents for new leases climbed only 1.4% in 2013, the weakest year over year increase in 14 quarters.
San Diego’s apartment market has historically been reliably steady, but rarely a top performer in terms of rent growth. But in 2013, rent growth in San Diego topped the levels seen for the U.S. overall and for most other Southern California markets.
at the end of 2013, San Diego is starting to see some pretty good momentum just as the U.S. average rent growth change has started to cool. As of Q4 2013, San Diego registered 3.6% rent growth while the U.S. apartment market as a whole registered 2.9%.
One of the driving factors for this growth has been a strong economy. In 2012, employment hit a decade high in the metro and while job numbers cooled slightly in 2013, the market experienced a 1.8% job expansion rate, good enough for second best in Southern California. San Diego is also the first Southern California market to return to pre-recession employment levels
Economy: The good news for Orlando is that the economy is growing at a solid pace. In fact, job growth hit a post-recession high in Q4 with 29,000 jobs added annually, an expansion rate of 2.7% and good enough to be 10th best in the country among the core 100 metros.
Rent Growth: Despite the growing economy and occupancy levels, there still isn’t much rent growth in Orlando. Overall, for 2013, rents were up only 1.7%, an 11 quarter low.
If not for a significant amount of supply scheduled for 2014 (6,133 units scheduled), Orlando could have been positioned for a pretty nice bump given the strong demand tailwinds. But with all that new supply, MPF Research expects occupancy to trend down about 100 basis points and for rent growth to remain limited.
Dallas Forth Worth
Apartment demand in Dallas/Fort Worth was stronger than anywhere else in country in 2012 and then again in 2013. The high demand reflects back to back years of strong job growth.
Occupancy: D/FW has had more demand that it has supply in each of the last four years, and that means occupancy is in good shape: At 94.4%, the occupancy rate in the metro remains at a 14-year high.
Outlook: With nearly 17,000 new units expected to complete in the region, rent growth in the middle and lower end products will have to remain strong for D/FW to continue its momentum of strong occupancy and rent performance. MPF Research expects momentum to slow slightly with rents climbing around 3.0%