Category Archives: Top Cities

Top Five Performing Secondary Apartment Markets

by  - Property Management Insider

Cap rate compression and price appreciation has led to more apartment investors seeking opportunities in smaller markets across the country. MPF Research examines which smaller markets have performed well of late, and which ones offer promise going forward.

Major markets, according to MPF Research, are the top 50 apartment markets according to the total number of apartment units. Secondary markets, as defined by MPF, are those markets outside the top 100 and typically have between 25,000 to 85,000 apartment units.

Looking at the apartment performance of secondary markets over the past year, there are five metros that clearly stood above the rest. These five markets all rank in the top five of annual revenue growth and annual rent change among secondary markets.

Rank Metro Annual
Revenue Growth
Occupancy Annual
Rent Change
1 Fort Myers/Naples, FL 9.5% 96.4% 7.0%
2 Santa Rosa/Petaluma, CA 7.5% 98.2% 6.8%
3 Corpus Christi, TX 6.9% 96.9% 6.3%
4 Sarasota/Bradenton. FL 6.6% 96.3% 5.8%
5 Honolulu, HI 6.1% 97.4% 6.2%

 

Top Secondary Markets Looking Forward

While this list of top performing secondary markets deals with past performance, here are some markets that MPF Research likes going forward:

  • Corpus Christi, TX
  • Santa Rosa/Petaluma, CA
  • Greenville, SC
  • Charleston, SC
  • Oklahoma City, OK
  • Madison, WI
  • Albany, NY

Texas Markets Rank Tops Nationally for Apartment Demand

by  - PropertyManagementInsider.com

Among folks who pay even the slightest bit of attention to what’s happening in local economies across the country, it’s not exactly breaking news that lots of jobs are being added in Texas. The Great Recession that so many spots nationally are still struggling to recover from was barely a blip on the radar screen across much of the Lone Star State, and job growth has been at or even above the past norms for quite a while.

What you might have missed unless you pay really close attention to the stats, however, is that early figures for job production in 2013 show the economies in Texas kicking into even higher gear and breaking further away from the pack.

That’s particularly true in Houston.

Sure, Houston is the country’s growth leader in terms of the absolute number of jobs created, as it has been for the past couple of years. The latest figure from theBureau of Labor Statistics places that number at 118,700 jobs on an annual basis. What’s changed is that Houston is now also in the #1 position for percentage expansion among the 100 largest markets in the U.S. The metro’s 4.5% growth rate is a truly phenomenal performance given the Houston area is more than three times the size of all but one other place registering growth of 3% or better.

No surprise, Dallas/Fort Worth is the big-market bridesmaid at this wedding, though the 3.7% job growth rate in North Texas really isn’t quite in the same category with Houston’s impressive showing.

Jobs translate to new household formation and apartment demand, right?

Thus, it’s no shock to see the two biggest job producers among the nation’s really large metros also at the top of the charts for apartment leasing during the year-ending 1st quarter. Despite adding fewer jobs than Houston, Dallas/Fort Worth actually garnered the most apartment demand – 11,194 units, compared to 8,044 units – mainly because D/FW operators worked especially hard in order to get a meaningfully bigger block of completions through initial lease-up. Dallas/Fort Worth registered additions totaling 8,443 units during the past year, versus the 5,626 units finished in Houston. The Houston crowd probably isn’t complaining about a little less demand compared to the D/FW tally, however, as they did notably better on rent growth – 3.8% in Houston, relative to 2.3% in Dallas/Fort Worth.

Over the next year or so, look for it to continue be a neck-and-neck race between Houston and Dallas/Fort Worth for the lead in apartment absorption nationally. Houston should continue to have the key advantage of a faster-growing economy, but D/FW will continue to add more new product completions that operators will be pushing hard to get through lease-up.

 

 

Best Cities for Veterans

Bert Sperling, Founder and President Bestplaces.net

Veterans starting the post-service phase of their lives face a unique set of opportunities and challenges.veterans from the marines army air force and navy

On the one hand, the post-9/11 G.I. Bill can help with getting a college education.  On the other hand, the Bureau of Labor Statistics reports that veterans between the ages of 25 and 34 have unemployment rates nearly 4 points higher than comparable civilians.

Working with USAA Insurance and Military.com, we decided to shed some light on this issue by determining the Best U.S. Cities for Veterans.

Out of 379 major U.S. metro areas, here’s the top 10:

  1. Pittsburgh, PA
  2. Phoenix, AZ
  3. Dallas, TX
  4. Cleveland, OH
  5. Atlanta, GA
  6. Warren, MI
  7. Ann Arbor, MI
  8. Cincinnati, OH
  9. Columbus, OH
  10. St. Louis, MO

Each of the variables was weighted based on what soon-to-be or recent veterans said was important to them, and each metro area was then ranked based on its total points for all variables.

Here’s the criteria we considered:

  • Military skill-related jobs
  • Presence of colleges/universities
  • Economic stability
  • Mass transit availability
  • Crime level
  • Unemployment rate
  • Volume of DoD conracts
  • Health resources
  • Affordability
  • Property Tax
  • Local schools
  • Airport proximity
  • Recent job growth
  • Recreation
  • Sales tax
  • Climate
  • Number of federal government jobs

Metro areas with the following attributes were excluded from the list: unemployment rate more than 1% above the national average, cost of living greater than the national average and total crime rate more than 25% above the national average.  You can check out the study on USAA’s site here.

10 Cities Where Landlords and Renters are Miles Apart on Rents

ByDerek Mearns - MultiFamilyExecutive.com

The first step in the search for a new apartment is very often scouring internet listing services. Among the most important search criteria is usually the price range that an individual is willing to pay.

But how realistic are renters when seeking cheap apartment deals in major urban areas?

According to the newest data from Apartments.com, many Gen Y-ers and other first-time renters are way off on what the going rate is for an apartment in many of the most popular U.S. cities. And the price they are hoping to pay just doesn’t exist in many markets.

Take a look at 10 cities where renters severely underestimate the actual cost of rent when conducting their apartment searches online. Sometimes what someone wants to pay is nowhere close to what they will have to pay. Here’s some of the cities where hopeful renters and market-making landlords were the furthest apart:

City

Difference between actual rental rates and renter expectations

Brooklyn, N.Y.

-50%

Jersey City, N.J.

-47%

Oakland, Calif.

-46%

Boston, Mass.

-42%

New York, N.Y.

-41%

Denver, Colo.

-37%

Los Angeles, Calif.

-36%

Fort Lauderdale, Fla.

-35%

San Francisco, Calif.

-35%

North Hollywood, Calif.

-34%

The 5 Best and 5 Worst Cities for Rents in October

By Derek Mearns - Multi-Family Executive Magazine

While rent growth didn’t fluctuate too much from September to October in 2012, there were still winners and losers. During the month, eight metro areas had annual effective-rent growth above 7 percent. Unfortunately, there were plenty of cities in the red, too.

Here’s a list of the top five metro areas for annual effective-rent growth and the five cities at the bottom of the barrel:

 

Metro Statistical Area (MSA)

Annual Effective-Rent Growth, 10/12

Occupancy Rate, 10/12

San Francisco

8.3%

95.8%

Naples, Fla.

8.0%

95.9%

Louisville, Ky.

7.9%

95.5%

Corpus Christi, Texas

7.8%

96.1%

Oakland, Calif.

7.4%

96.8%

Virginia Beach, Va.

-0.7%

92.9%

Las Vegas

-0.8%

91.2%

Tacoma, Wash.

-1.1%

93.7%

Mobile, Ala.

-1.3%

92.1%

Savannah, Ga.

-1.9%

94.4%

 

Top 10 Metros with Highest Occupancy Rates

By Derek Mearns - MutliFamilyExecutive.com

Across the board, occupancy rates were up during the third quarter of 2012, according to the latest data from Dallas-based Axiometrics.

In August alone, occupancy rates increased 89 basis points (bps) on a year-to-date basis and 26 bps on an annual basis. But this positive number still represents a decline from last August, when occupancy rates were up 102 bps on a year-to-date basis, and 58 bps on an annual basis. But demand is still high, so there’s no cause for alarm.

Here’s a list of some cities among the highest in average occupancy rates as of the third quarter of 2012:

City

Average Occupancy Rate

New York

97%

Boston

96.1%

Los Angeles

95.6%

Denver

95.3%

Chicago

95.2%

Seattle

95.2%

Dallas

94.5%

Orlando

94.4%

Houston

93.3%

Phoenix

93%

In terms of rent growth, San Francisco and San Jose led the way with annual rent growth of 11 percent and 8.8 percent year-over-year, respectively. Other leaders include Denver at 7.1 percent, Houston at 6.7 percent, and Seattle at 5.4 percent on a year-over-year basis for the third quarter.

Top 10 College Town Destinations for Gen Y

By Derek Mearns - MultiFamilyExecutive.com

 

Where are Gen Y students most likely to find jobs? If you guessed New York or San Francisco, you’d be wrong.

There was quite a shake up on this year’s College Destinations Index, a ranking of the nation’s healthiest economies for Gen Y students to live in, produced by the American Institute for Economic Research.

Despite all the hype surrounding the major metros, New York, Boston, Washington, D.C., and San Francisco were all knocked out of the top 10 on this year’s list for college towns. The list is determined based on overall economic health, measuring unemployment rate, entrepreneurial activity, and arts and leisure considerations.

And this year, small towns led the way as larger cities were more susceptible to economic downturns and only ranked outside of the college towns division on the index. As the report suggests, many small towns are essentially recession-proof since they house a consistent population of spenders. Here’s a look at the top 10 college destinations for 2012-2013:

Rank 2010-2011 Top College Town Destination 2012-2013 Top College Town Destination

1

Ithaca, N.Y. Ithaca, N.Y.

2

State College, Pa. Ames, Iowa

3

Boulder, Colo. State College, Pa.

4

Iowa City, Iowa Iowa City, Iowa

5

San Francisco, Calif. Corvallis, Ore.

6

Ames, Iowa Ann Arbor, Mich.

7

New York, N.Y. Champaign-Urbana, Ill.

8

Washington, D.C. Lafayette, Ind.

9

Boston, Mass. Lawrence, Kan.

10

Ann Arbor, Mich. Morgantown, W.Va.

Top Ten Apartment Market Rent Growth Leaders for Third Quarter 2012

by  - PropertyManagmentInsider.com

When MPF Research releases its quarterly research numbers for the U.S. apartment market, I look forward to finding out which metro secures the top spot for rent growth. During the past few quarters, the top spot has been held by one of two metros: San Jose or San Francisco.

It’s the apartment market equivalent of a great sports rivalry or the quarterly version of the USA Today College Football poll.

So who came out on top for the third quarter of 2012? Let’s get to the box score:

Rent Growth Leaders in Year-Ending 3Q 2012
Rank Metro Annual Rent Growth
1 San Jose 8.0%
2 San Francisco 7.5%
3 Oakland 6.7%
4 (Tie) Charlotte 6.3%
4 (Tie) New York 6.3%
6 (Tie) Columbus 6.1%
6 (Tie) Hartford 6.1%
8 Denver-Boulder 6.0%
9 Houston 5.5%
10 Nashville 5.1%

 

And San Jose is back on top after ceding the top spot to San Francisco last quarter. However, even in these top-of-the-chart markets, the pace of rent growth has cooled notably. Annual rent growth peaked in late 2011 at 13.2 percent in San Jose and at 14.6 percent in San Francisco.

Other major markets performing well but not enough to push them into the top 10 were Boston (4.9%), Portland (4.8%), Austin (4.6%), and San Antonio (4.5%).

For additional information and research about the performance of the U.S. apartment market during the third quarter of 2012, visit the following resources:

10 Cities Where It’s Much Cheaper to Rent Than Own

ByDerek Mearns - Multifamily Executive Magazine

 As rents continue to rise and home prices continue to decline, the advantages of renting over owning is becoming ever narrower in many major metropolitan areas.

According to the latest data from Zillow, nearly 75 percent of the 200 metro areas it surveyed would see homeowners reach a “breakeven point” in three years or less. The breakeven point essentially refers to the amount of time a homeowner would need to live in a new home before the cost of owning become less than the cost of renting.

Despite these findings, the consensus seems to be that people are still scared to enter into homeownership due to a fragile economy. And financing is certainly tougher to come by these days. But that doesn’t mean homeownership isn’t gradually become a more viable financial option for the latest generation of renters.

Here’s a look at the top 10 cities where it makes more financial sense to rent:

City

Breakeven time (years)

San Jose, Calif.

8.3

Honolulu, Hi.

6

San Francisco, Calif.

5.9

New York City, New York

5.1

Boston, Mass.

4.3

Los Angeles, Calif.

4.3

Seattle, Wash.

4

San Diego, Calif.

3.6

Washington, D.C.

3.5

Portland, Ore.

3.5

Top 8 College Towns for Investors

Posted by GLOZAL

Investors increasingly are eyeing college towns to snag properties at discounts and turn them into rental properties that could potentially offer steady cash flow with student tenants. But which college towns offer some of the best returns?

Realtor.com recently released its second annual list of the best college towns for investors, factoring in average monthly rental prices and comparing it to estimated mortgage payments of a median priced home.

The following are the top eight college towns for investors, according to this year’s report.

1. Boston

Median list price: $334,900

Average rent: $3,084

Mortgage payment estimate: $1,240

2. Princeton, N.J.

Median list price: $265,000

Average rent: $2,056

Mortgage payment estimate: $980

3. Chicago

Median list price: $194,000

Average rent: $1,630

Mortgage payment estimate: $720

4. Washington, D.C.

Median list price: $395,000

Average rent: $2,637

Mortgage payment estimate: $1,460

5. Houston

Median list price: $183,000

Average rent: $1,134

Mortgage payment estimate: $680

6. Philadelphia

Median list price: $234,900

Average rent: $1,475

Mortgage payment estimate: $870

7. Atlanta

Median list price: $174,900

Average rent: $1,187

Mortgage payment estimate: $650

8. Pittsburgh

Median list price: $140,000

Average rent: $1,122

Mortgage payment estimate: $520