Categories
- 1031 Exchange
- AAOA Forum
- Collections
- Credit Screening
- Financing
- Forms
- Going Green
- Insurance
- Make Extra Money
- Marketing Vacant Units
- Promotional
- Property Sales
- Remodel Tips
- tax tips
Archives
- November 2009
- October 2009
- September 2009
- August 2009
- July 2009
- June 2009
- May 2009
- April 2009
- March 2009
- February 2009
- January 2009
- December 2008
- November 2008
- October 2008
- September 2008
- August 2008
- July 2008
- June 2008
- May 2008
- April 2008
- March 2008
- February 2008
- January 2008
- December 2007
- November 2007
- October 2007
- September 2007
- August 2007
- July 2007
Welcome to the AAOA Forum, where we discuss the the topics our members want to hear and want to talk about. We like to take an active roll in the online community to help our members learn and help educate landlords new and old. We encourage you to participate and join in our discussions. Thanks.
Rents Show First Decline in Over Five Years
by Apartment Building Management Insider
U.S. apartment rents fell in the fourth quarter from the third as the national vacancy rate climbed to a four-year high of 6.6 percent, according to a report just published by Reis Inc., a New York-based research firm.
The report defies the expectation that apartments would benefit from the housing slump as job losses and lower wages are cutting into the pool of potential renters in their twenties and thirties.
Asking rents fell 0.1 percent from the previous quarter, to $1,052 on average, their first quarter-to-quarter decline in almost six years. Effective rents, what tenants actually paid, fell to an average $996 last quarter, down 0.4 percent from the prior quarter.
Vacancy Rate
The vacancy rate rose to 6.6 percent in the fourth quarter from 6.2 percent in the third quarter and 5.7 percent at the end of 2007. The fourth quarter matched the vacancy rate in 2005’s first quarter and was the highest since the fourth quarter of 2004, when it was 6.7 percent, according to Reis.
Vacancies increased in 66 of the 79 cities measured by Reis and effective rents fell in 54 markets.
The net change in occupied space, a measure of leasing known as absorption, shrank by 13,283 units.
Copyright 2009 Apartment Building Manager Insider
American Apartment Owners Association offers discounts on products and services related to your commercial housing investment including REAL ESTATE FORMS, tenant debt collection, tenant background checks, insurance and financing. Find out more at www.joinaaoa.org.To subscribe to our blog, click here.
Filed under: AAOA Forum
[...] Read the rest here [...]
Not sure what is responsible for this.I have been trying to rent one of my units since November of 2008.I reduced the rent couple times.Too much rentals on the market due to the economy may be.
In my opinion we all had to know that this was coming. I see how some would think that because people are lossing their jobs that they would move into a more affordable apartment. This obviously is NOT the case. The majority of the applicants I have seen in the last quarter have been;
1. Fresh out of Bankruptcy or Forclosure
2. Down to one income; spouse lost a job
3. New on the job; still a “Temp”; moved to make more money.
4. Concerned about layoffs and looking to down-size.
#4 is probably not a bad idea, however smart, lets face it the prospective tenant pool has really dried up!
You see rents drop REALLY fast when you need to discount to fill your vacant units because there are no “Qualified” renters in sight.
THEN….you have the tenants that are Moving Out. They are being forced to go;
1.BACK HOME with the parents.
2.or worse….moving in with the In-laws!!!
You get the picture. I can’t tell you the number of people, of all ages, who are moving because they;
1. Have lost their job.
2. Moving to find a new job.
3. Moving to save; because spouse lost job.
This is just sad, not to mention extremely scary.
It doesn’t make sense why the vacancy is increasing and rents going down. I read in the papers that a lot of people lost their homes due to lost jobs etc. Where did these people go?
I Liked it!! Brief and to the point… Verty informitive… Thank you
[...] See Rents Decline for First Time in Five Years While Vacancy Rates Rise. [...]
[...] market in your area. Share you thoughts by posting a comment below. See our feature, Rents Decline for First Time in Five Years. American Apartment Owners Association offers discounts on products and services for [...]
[...] 3 Ways a Stimulus Bill Could Help Landlords It’s expected that an $800 billion plus stimulus package proposed by President Obama will pass this week. Details of the final plan are sketchy. A crucial question remains unanswered: How will the Stimulus affect landlords? There are three possible upsides to the bill that may help with the current rental market: Easing Unemployment May Increase Available Renters 1. Experts point to rising unemployment as a primary factor in current high vacancy rates. If the Stimulus creates or protects jobs, it could bolster the rental market. 2. Part of the Stimulus funding may be directed to extending unemployment benefits. This could keep renters in place and help them honor their leases. Extending Tax Credit May Ease Glut of Rental Inventory 3. Another stimulus proposal is extending the home buyer’s tax credit, an incentive to aspiring home buyers that the NAR says is crucial to spurring home sales. Many investors would prefer flipping their properties to remaining reluctant landlords, and sales could reduce the overstock of rental inventory that is helping to drive down rents. But these are short-term fixes. There are other factors that are hard to predict in the long run. What will the overall cost be? What are the downsides? What will the overall impact of the Stimulus plan be on landlords? Share you thoughts by posting a comment below. See our feature, Rents Show Decline for First Time in Five Years. [...]
[...] serve on NMHC’s Board of Directors or Advisory Committee responded. See our feature Rents Decline for First Time in Five Years. American Apartment Owners Association offers discounts on products and services for landlords [...]
For Kemmy: you are correct in saying it is hard to rent since November 2008 I have a senior community and have the same problem. I have had to run some move-in specials like:
$100.00 off 1st two months rent,
OR
$100.00 gift card from Wal*Mart,
OR
We will pay the deposit for utilities,
OR
1/2 off the first months rent;
sometimes these can be costly to the owner, but if you look overall worst case $500.00 move in special or $4,920.00 rent loss for the year.
Sergio:
I know even the senior community is getting hard to rent at this time, but most people these days looking in the past I have been in property management for 17 years and folks don’t move in the winter months. I have lost some of my seniors to their family members because they just simply can’t make it on their own so the next thing is moe i with family. I remember going through this back in the 80’s and ended up renting to two families in the same unit just to fill my vacancies. As I stated before look in the paper in your area and see what the move-in specials and try to beat what they offer. Just keep your head high and we will pull out of this mess, keep your faith and we will be fine.
[...] of white-collar jobs is an important factor for the increase in vacancies. See our feature, Rents Show First Decline in Over Five Years. American Apartment Owners Association offers discounts on products and services for [...]