Multifamily Rents Steady, but Below the Peak
It’s a boon for renters, but just so-so for the multifamily owners as effective rent growth is down from its peak earlier this year. But, there’s a silver lining to this cloud: the Austin-Round Rock MSA remains well above the national average in terms of effective rent growth and occupancy, according to the analysts at Axiometrics. (So, at least you’re not in Boise.) The metro achieved 5.5% rent growth in December 2013 and fell below 5% in July for the first time in nine months. This is likely a function of the massive amount of new supply that has come on the market in the past 15 months.
The stats aren’t as scary as Axiometrics’ offices. (That’s Jay Denton, who heads the analytics department, working behind the caution tape listening to Monster Mash, we presume.) About 11,645 new units were delivered between the start of 2013 and the end of the Q3, with 10,139 more identified for delivery from now through the end of 2015. Axiometrics analysts have found that much of the rent growth is taking place among properties charging $700-$999 monthly rent. Properties at that level – which classify at B- or C — are experiencing effective rent growth in the 7% to 8% range. The new supply doesn’t affect this class as much as it does Class-A, in which most of the new supply exists.
