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June 17, 2014

Why Renters Are Ending Up in the Suburbs

Post-recession housing demand has tilted to favor renting, with the number of renter households growing for the last nine consecutive years. New apartment development in downturn urban cores is only part of the solution in meeting this demand. This article by The Atlantic’s City Labs writer Kriston Capps explores the single-family rental market growth driving some of the nation’s fast-growing suburbs and exurbs. Her conclusion:

“The appetite for rental housing, which traditionally takes the form of multifamily housing, is transforming the suburbs and its traditionally single-family homes. With affordable housing harder and harder to find in places such as Austin, New York, and Washington, D.C., renters are finding themselves in the suburbs in the single-family homes built for the last boom. Developers are retrofitting the financial reality of the suburbs—from ownership to rental societies—without changing the suburban home whatsoever

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RESEARCH

A Closer Look at Monthly Starts Figures

This week’s release of the latest monthly housing construction numbers no doubt will spark a flurry of media stories. But for all the hubbub, is that the best indicator of market trends? NMHC Senior Research Analyst Caitlin Walter explains why monthly stats offer a limited picture of what’s actually going on in the market.

HOUSING POLICY

Affordable Housing Thatís Very Costly

The trouble with inclusionary zoning policies in high-rent districts is that they typically generate fewer affordable housing units than a cash equivalent. Why? High-end apartments make for an expensive form of affordable housing. This NYT’s article considers the pluses of pairing inclusionary zoning requirements with density bonuses.

TAX

Tax and Spend Is About to Hit Real Estate Investment Hard

IRC Section 1031, more commonly known as the like-kind exchange, has created a huge buyer demand over the years for everything from rental homes to shopping centers and office buildings. However, Congress has no fewer than three different proposals on the table that would either completely do away with the 1031 Exchange or do enough damage to it that real estate investment activities will plummet in the future.

FINANCE

CMBS Lenders Offer More Competitive Terms

As capital has continued to flow freely into the multifamily sector, the commercial mortgage-backed securities (CMBS) market has been somewhat sidelined by the competition. CMBS issuance volume is down 25 percent so far in 2014 compared to 2013. But CMBS lenders are fighting back, offering multifamily borrowers more loan proceeds and longer interest-only periods. (Login required.)

NMHC 50

Rivals See Opportunity in Greystar-Riverstone Marriage

In the wake of the announcement that the two largest apartment management firms—Charleston, S.C.-based Greystar Real Estate Partners and Dallas-based Riverstone Residential—would become one mega powerhouse, many competitors, clients and employees have wondered just exactly what the news means to them. While the nearly 400,000-unit Greystar-Riverstone colossus could, on the surface, create problems for both national and regional property managers, those competitors also say the merger will create opportunity.
In Case You Missed It
A hand-selected collection of noteworthy articles on a wide variety of issues of interest to apartment executives.
Real Estate Moves Crowdfunding Beyond Just Trinket 

Student Loans Make It Hard to Buy or Rent a Home

Condo Towers Make a Comeback

100,000 Homes: Housing the Homeless Saves Money?

Micro Units with an Added Twist: Roommates

Equity Residential Teams Up with Toll Brothers on a Unique Two-in-One Tower

Top 10 Cities for Renters on the Move

Why Does Multifamily Compare Apples to Oranges When Looking at Rent Benchmarks?

German Apartment Developer Takes Energy Efficiency to a New Level with Activhaus

Morgan Properties’ Joint Venture with Saudi-based Olayan Group Snaps Up Mid Atlantic Portfolio

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A must-read for top apartment industry professionals, Apartment Wire is a timely review of emerging trends in apartment finance, development, management and technology and more, featuring both exclusive content from NMHC's staff of experts and provocative articles from across the web.
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Multifamily Market Dashboard

What Can We Expect for Apartment Completions?

For the second year, multifamily starts have surged in the winter and early spring months. Some reports have characterized this activity as reaching “record” levels, fueling concerns that the wave of new supply could swamp the demand for new apartment residences.

NMHC’s research team recently tackled the data and offers this takeaway: Construction has certainly fully recovered; however, talk of national oversupply is premature at best, and suggestions that apartment construction is at unprecedented levels are just way off base.

In fact, even with an expected steady increase in production, data projections suggest apartment completions for 2014 and 2015 will still be below the 300,000 mark, which is the minimum number of new units the industry needs to build annually to meet demand.

Read the full version of Research Notes here.

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