Connect with us

Hi, what are you looking for?

The American GeniusThe American Genius

Commercial Real Estate

CBRE predicts multifamily vacancies will fall while prices rise

Multifamily sector improving

Despite the volatility of the multifamily sector, experiencing an 8.3 percent drop in starts in October and a 24.4 percent rise in permits issues (much larger swings than in the single family housing sector), CBRE Econometric Advisors (CBRE-EA) is reporting that the U.S. apartment market has recovered and is in expansion mode.

According to Reuters, the firm said they expect vacancies to remain steady at 5.5 percent in 2012 then fall below pre-downturn levels. The apartment vacancy rate in 2009 was 7.4 percent yet in late 2011, rents are predicted to rise another three percent next year (on top of the predicted 4.1 percent increase this year), and investors are snapping up apartment buildings at record highs in some areas.

Despite very recent volatility, it appears the multifamily market is experiencing a very temporary hiccup, as foreclosures continue to be a moving force in the industry and as renting has become the new black and the stigma around being a renter has quickly faded and the American Dream of Homeownership has recently shifted substantially as has the demographic of the average buyer.

Vacancy rates will continue to drop

CBRE-EA predicts that the vacancy rate will drop to 5.2 percent in 2013 and down to 5.1 percent in 2014 – they forecast we’ll hover around five percent for an extended period of time as unemployment remains high and consumer confidence remains low. CBRE-EA predicts that homeownership is likely to rise soon, in fact, they predict it could be flat or drop.

Advertisement. Scroll to continue reading.

“Multifamily housing is leading commercial real estate in terms of its recovery,” Gleb Nechayev, senior managing economist of CBRE-EA told Reuters. “It’s actually not in recovery anymore. It entered the expansion phase, which means it’s actually back to the normal vacancy levels.”

Tara Steele is the News Director at The American Genius, covering entrepreneur, real estate, technology news and everything in between. If you'd like to reach Tara with a question, comment, press release or hot news tip, simply click the link below.

30 Comments

Leave a Reply

Your email address will not be published. Required fields are marked *

Advertisement

The
American Genius
news neatly in your inbox

Subscribe to our mailing list for news sent straight to your email inbox.

Advertisement

KEEP READING!

Commercial Real Estate

When considering whether you should lease your office space or buy, an industry expert outlines the questions you should ask yourself.

Real Estate Technology

(TECH NEWS) It turns out that Internet of Things, like smart bulbs in homes, are not secure and give up your info - here...

Real Estate Marketing

(MARKETING) Your fancy, self-animating website might be making people violently ill, even if it is insanely beautiful. Sorry...

Real Estate Marketing

(MARKETING) Conduit is a CRM that does more than CRM, it analyzes your networking data to help you see how to improve your relationships.

The American Genius is a strong news voice in the entrepreneur and tech world, offering meaningful, concise insight into emerging technologies, the digital economy, best practices, and a shifting business culture. We refuse to publish fluff, and our readers rely on us for inspiring action. Copyright © 2005-2022, The American Genius, LLC.