Providence Rents Aren’t Moving Much

by  - Property Management Insider

Northeast apartment markets generally rank as the tightest across the country. Among the 16 metros there that MPF Research counts in our U.S. results for the nation’s 100 largest markets, average occupancy of 96.5 percent is 1.1 percentage points above the norm. And every single metro records occupancy at or above that U.S. average of 95.4 percent.

Providence is a typical occupancy performer for the region. The area’s current occupancy figure of 96.5 percent exactly matches the regional norm, and the rate has been hovering at roughly 96 to 97 percent since the middle months of 2010. There’s very little variation in occupancy results by either product niche or neighborhood.

However, Providence is not doing as well as most other metros in the Northeast when it comes to apartment rent growth. Whereas the annual change in effective rents for new leases is running at 3 percent across the region as a whole, pricing in Providence went up just 1.1 percent between 3rd quarter 2011 and 3rd quarter 2012.

A still-challenged economy that is holding back wage growth appears to be the biggest obstacle that Providence faces in getting rents moving up more significantly. September’s unemployment rate in Providence was 9.8 percent, well above the national norm and tremendously over pre-recession levels that were below 6 percent. The total job count in the metro is still down about 45,000 positions, or 8 percent, from the late 2007 figure.

The latest stats did bring the first real signs of some progress, however. The unemployment rate as of September was down to single digits for the first time since late 2008, and year-over-year change in the total job tally finally was up a little on an annual basis. Some 2,200 positions were added.

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