Metropolitan Area Statistics Apartment Completions 1Q 2011 1Q 2012 % Chg Atlanta - - n/a Boston 133 39-71% Chicago - 20 n/a Cleveland - - n/a Columbus - 272 n/a Dallas-Ft. Worth 604 1,059 75% Denver 328 280-15% Detroit - - n/a Houston 185 316 71% Indianapolis 150 32-79% Las Vegas - 320 n/a Los Angeles 918 218-76% Miami - - n/a Minneapolis - 274 n/a New Jersey 703 407-42% New York 1,373 287-79% Oakland-East Bay 422 - -100% Orange County - - n/a Orlando - 420 n/a Philadelphia - 414 n/a Phoenix - - n/a Portland - - n/a Sacramento - - n/a Riverside 100 - -100% San Diego - - n/a San Francisco - - n/a San Jose - - n/a Seattle-Tacoma 558 271-51% Petersburg - 296 n/a Washington, D.C. 11 159 1,345% U.S. Metro Total 7,585 7,342-3% Apartment Effective Rents 1Q 2011 1Q 2012 % Chg Atlanta $745 $759 1.9% Boston $1,625 $1,668 2.6% Chicago $977 $997 Cleveland $692 $708 2.3% Columbus $625 $645 3.2% Dallas-Ft. Worth $698 $721 3.3% Denver $794 $817 2.9% Detroit $742 $762 2.7% Houston $698 $719 3.0% Indianapolis $627 $644 2.7% Las Vegas $742 $755 1.8% Los Angeles $1,319 $1,350 2.4% Miami $1,009 $1,031 2.2% Minneapolis $889 $926 4.2% New Jersey $1,233 $1,267 2.8% New York $2,721 $2,807 3.2% Oakland-East Bay $1,208 $1,252 3.6% Orange County $1,422 $1,466 3.1% Orlando $776 $790 1.8% Philadelphia $980 $1,004 2.4% Phoenix $685 $701 2.3% Portland $750 $781 4.1% Sacramento $847 $865 2.1% Riverside $956 $980 2.5% San Diego $1,272 $1,304 2.5% San Francisco $1,720 $1,821 5.9% San Jose $1,362 $1,429 4.9% Seattle-Tacoma $928 $959 3.3% Petersburg $765 $775 1.3% Washington, D.C. $1,308 $1,349 3.1% U.S. Metro Total $962 $989 2.8% Apartment Vacancies 1Q 2011 1Q 2012 bps Chg Atlanta 9.2% 7.4% (180) Boston 4.6% 3.8% (80) Chicago 5.4% 4.4% (100) Cleveland 5.2% 4.1% (110) Columbus 8.6% 6.4% (220) Dallas-Ft. Worth 7.9% 5.9% (200) Denver 5.5% 5.1% (40) Detroit 6.6% 5.1% (150) Houston 10.3% 8.1% (220) Indianapolis 7.5% 5.6% (190) Las Vegas 8.6% 7.1% (150) Los Angeles 4.6% 3.7% (90) Miami 5.6% 4.4% (120) Minneapolis 3.2% 2.5% (70) New Jersey 4.5% 3.7% (80) New York 2.7% (70) Oakland-East Bay 4.3% 3.5% (80) Orange County 4.9% 3.7% (120) Orlando 7.9% 6.4% (150) Philadelphia 5.0% 3.9% (110) Phoenix 9.0% 6.7% (230) Portland 3.9% 2.4% (150) Sacramento 5.7% 4.4% (130) Riverside 6.0% 4.5% (150) San Diego 2.9% (110) San Francisco 3.1% (90) San Jose 3.4% 2.6% (80) Seattle-Tacoma 5.4% 4.2% (120) Petersburg 7.3% 5.9% (140) Washington, D.C. 4.9% (90) U.S. Metro Total 6.2% 4.9% (130) Sources: Marcus & Millichap Research Services, Reis, Costar Group Inc., Real Capital Analytics
Units Multifamily Starts 250,000 200,000 150,000 100,000 50,000 136,000 Jun. Jul. Aug. Sep. Oct. Nov. Dec. Jan. 217,000 Finished Goods vs. Construction Materials and Components 1.5% 1.0% 0.5% -0.5% -1.0% 0.6% 0.3% Materials & Components for Construction 0.4% 0.3% Finished Goods Multifamily Starts: In April, the seasonally adjusted annual rate of starts in buildings with five or more units increased 4 percent to 217,000 units. However, revisions to previous data indicate the level of multifamily construction activity is even stronger than previously estimated. Following the revisions, the data now show the five-plus starts rate has stayed above 200,000 for three consecutive months the first time this has happened since those production rates crashed in late 2008. The rate at which permits are issued declined 23 percent in April, slipping to a level of 217,000. That points to a potential drag on five-plus starts over the near term. From a longer perspective, 5+ permits and starts in April were both up strongly on a year-over-year basis, rising by 40 percent and 75 percent, respectively, and have tripled since bottoming out in the second half of 2009. Interest Rates 5.0% Building Materials 6.0% - 5.1 4.6 2.7 2.1 2.2 2.0 1.4 1.2 0.6 0.4 0.2-0.4-0.6-1.9-2.4 - Feb. Mar. Apr. Cement Softwood Lumber Steel Gypsum Plywood 3.0% 1.0% Prime Rate 3.25% 10-Year Treasury 3.17% 3-Month Libor 0.26% Prime Rate 3.25% 10-Year Treasury 1.80% 3-Month Libor 0.47% Building Materials: The aggregate producer price index for residential construction rose 0.2 percent for the month, and the pace of year-over-year increases slowed to 2.9 percent from recent highs between 6 percent and 7 percent in mid-2011. In a surprise development, gypsum prices declined 1.9 percent between March and April after strong gains through the beginning of the year that had brought prices to 13.8 percent above levels seen at the end of last year. This decline brings the year-to-date gain in gypsum prices down to 11.6 percent over 2011. Producer price indexes for other home building materials showed softwood lumber prices rising 1.4 percent in April, while concrete prices declined 0.2 percent. August 2012 Multi-Housing News
CPI vs. Rent Existing Condo Median Sales Price 8.0% 6.0% - CPI 3.3% Rent 2.6% Rent 1.8% CPI 0.4% Price $200,000 $175,000 $150,000 $125,000 $165,500 Feb. Mar. $172,900 Apr. CPI vs. Rent: Housing costs, as measured by the shelter index, continued their gradual march higher by climbing 0.2 percent for the tenth time in the past 11 months, and increasing a modest 2.2 percent compared to April 2011. With prices for single-family housing beginning to stabilize, rental costs have become a point of focus as households make the decision to own or rent, and as available apartments have become more scarce in recent quarters. NAHB s measure of real rental rates is constructed from the CPI for rent of primary residences and overall CPI. This index increased 2.1 percent on an annualized basis in April, and registered its first year-over-year increase since October 2009. Relatively stronger increases in energy prices had masked the impact of rising rental rates, but declining prices across much of the energy complex could foster stronger gains in real rents. Existing Condo Median Price: According to the National Association of Realtors, the seasonally adjusted annualized rate of condominium and co-op sales rose 6 percent from March to 530,000 units. On a year-over-year basis, sales climbed 10.4 percent and have averaged nearly 525,000 units through the first four months of 2012. This marks the strongest four-month average pace in more than a year. The (seasonally adjusted) median sales price for existing condos and co-ops surged to more than $175,000 during April, which represented the highest reported price level in two years a period in which prices were bolstered by the federal government s homebuyer tax credit. MHN ONLINE Source: Commentary and Data supplied by Brian Lego, the National Association of Home Builders For more market statistics and reports, visit www.multi-housingnews.com Brian Lego is a senior economist at the National Association of Home Builders (NAHB). His responsibilities include producing forecasts of housing data for state and metropolitan areas, as well as providing analyses of various economic and demographic issues that affect the U.S. housing market. Lego has been an economist for more than 10 years, with prior stops as the Director of Economic Analysis for NEMA and as an Economist for Moody s Economy.com.
Total Multifamily Mortgage Debt Outstanding Government-Sponsored Enterprises Commercial Banking CMBS, CDO and other ABS Issues Agency-and-GSE-Backed Mortgage Pools 2011Q4 91.1 98.7 83.5 66.9 2010Q4 189.1 197.2 258.3 256.5 Apartment Equity REITs Performance Period to Date Performance (%) Dividend Yield (6-7-12) Price Return (6-7-12) 2.89-1.02 Total Returns (as of 6-7-12) 7-6-12 Q-T-D Y-T-D -1.03-1.07 7.30 Compound Annual Total Returns Through Prior Month s Close 1-Year 5-Year 10-Year 5.62% 5.25% 12.49% Source: National Association of Real Estate Investment Trusts State and Local Governments Savings Institutions Life Insurance Companies Other Federal Government 23.4 24.6 14.1 14.4 69.6 70.9 62.1 61.2 49.6 47.2 $0 $50 $100 $150 $200 $250 $300 Billions Source: Federal Reserve Flow of Funds, Reis Inc. Unemployment Rate Seasonally adjusted, 16 years and over Percentage of Unemployed 1 9.5% 9.0% 8.5% 8.0% 2011 2012 Source: U.S. Bureau of Labor Statistics 8.2% 8.1% Apartment Traffic Trends National Trends in Rental Applicant Traffic Signals Positive Trend Status Quo Negative Trend Application Rate (difference from avg) 0.015 0.010 0.005 0.000-0.005-0.010-0.015-0.020 Apr 08 Jul 08 Jobs Oct 08 Jan 09 Traffic Apr 09 Jul 09 Oct 09 Jan 10 Apr 10 Jul 10 Oct 10 Jan Apr Jul Oct Jan Apr 600 400 200 0-200 -400-600 -800 U.S. Job Change (thousands) Inconsistent job growth appears to be generating large fluctuations in apartment application volumes. Source: RentGrow, U.S. Bureau of Labor Statistics August 2012 Multi-Housing News
Apartment Transactions: Volume and Prices ($500,000+) Volume ($000,000) 20,000 15,000 10,000 5,000 0 1Q 10 2Q 10 3Q 10 4Q 10 1Q 2Q 3Q 4Q 1Q Source: PPR, a CoStar company No. Price Wtd. Avg. Quarter Prop. (Thousands) Units Price/Unit 4Q 2008 1,424 $5,986,970 83,083 $72,060 1Q 2009 1,014 2,969,491 45,992 64,565 2Q 09 1,189 4,299,508 60,094 71,546 3Q 09 1,234 5,082,311 74,300 68,403 4Q 09 1,461 6,552,563 94,434 69,388 1Q 2010 1,171 5,351,247 68,921 77,643 2Q 10 1,535 6,515,440 95,951 67,904 3Q 10 1,529 10,289,318 120,089 85,681 4Q 10 1,989 12,496,106 150,103 83,250 1Q 2011 1,584 9,047,926 110,399 81,957 2Q 2,065 14,249,479 171,749 82,967 3Q 2,006 13,760,380 151,273 90,964 4Q 1,904 15,818,396 181,991 86,919 1Q 2012* 1,536 9,706,731 108,955 89,089 *Quarter to date Park Effect: New York City Median sale prices in 2011 of condos/co-ops bordering Central Park West in New York were on average 118 percent higher than those in all Central Park zip codes. Unit Sales 2011 Median Sale Price 2011 Unit Sales 2010 Median Sale Price 2010 Change in Sales Transactions Change in Median Sale Price Co-op and Condo Units 405 $1,850,000 472 $1,836,425-14% 1% Bordering Central Park Co-op Units 267 $2,400,000 308 $2,050,000-13% 17% Condo Units 138 $950,000 164 $1,280,000-16% -26% Co-op and Condo Units 5,957 $850,000 6,826 $850,000-13% 0% All Central Park Zip Codes Co-op Units 3,200 $795,000 3,681 $787,000-13% 1% Condo Units 2,757 $920,000 3,145 $920,000-12% 0% Source: PropertyShark Market Pulse section compiled by Keat Foong, executive editor. To comment, email kfoong@multi-housingnews.com