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July 16, 2014

Amenities Trump Square Footage in Today’s Apartment Boom

Bigger isn’t necessarily better when it comes to choosing an apartment today. The median size of apartments in new U.S. buildings fell last year to 1,043 square feet, the smallest since 2002, as renters sacrifice living space for prime urban locations and community perks like cooking classes, pet grooming stations and poolside WiFi.

But even as people are living in less, they aren’t living for less. Square footages may have shrunk, but these attractive extras are adding to rental costs. The U.S. average rent per square foot was $1.25 in May, the highest in records dating to 1996, according to Axiometrics Inc.

While the trend toward smaller apartments could help address some of the nation’s affordable housing concerns, questions linger about the long-term demand for these smaller units, as well as the overall change these units will have on rental housing supply.

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RESOURCES

NMHC Newsroom Offers One-Stop Shop for Apartment Headlines

Updated almost daily, NMHC’s online newsroom is a single, go-to source for perusing the latest media stories, important legislative and regulatory updates and NMHC news. Whether you’re looking to just keep your finger on the industry’s pulse or are in need of fresh content for presentations or social media outlets, NMHC’s newsroom is the place to stay plugged into the best apartment information.

LEADERSHIP

The World Cup - Embrace It!

Bozzuto Management Company President and NMHC Diversity Committee Chair Julie Smith blogs on why the multiculturalism represented by the 2014 World Cup matters to the apartment industry, from the diversity of apartment residents to company associates. Smith notes that diversity and inclusion foster innovation and encourage fresh insight into old ways of thinking and doing business.

TECHNOLOGY

In the Rental Market, Craigslist May Be Undisruptible

The rental industry has a love-hate relationship with Craigslist. Its design has changed little since it began in 1995. There is no way to easily browse photos of available apartments. And its rental listings are riddled with duplicates and fakes. But it’s big and it’s free, allowing it to maintain its strange monopoly over online apartment listings.

RESEARCH

Quarterly Survey Responses Due July 21

It's time once again for NMHC’s Quarterly Survey of Apartment Market Conditions. The survey provides members with a timely and unique perspective on market conditions. Please share your perspective by taking the short survey here. Responses are needed by Monday, July 21.

A summary of all responses will be distributed to survey participants prior to the public release. Individual responses will be kept confidential. Take a look at previous quarters’ survey results here.

In Case You Missed It
A hand-selected collection of noteworthy articles on a wide variety of issues of interest to apartment executives.
Dad Is a Homeownership Advocate, But Daughter Still Debates Virtues of Owning Over Renting

Real Estate Crowdfunders Work to Minimize Capital Call Risk

Disparate Impact on the Path to the Supreme Court Once Again

Developing the Science of Resident Satisfaction

Builders See Shortage of Labor—Especially Subcontractors

How One NYC Councilwoman Is Redefining Housing Affordability Upward

Millennials Are Suburbanizing, While Big Cities Are Having a Baby Boom

Inside Greystar’s U.K.-based Student Housing Portfolio

Lofty Prices Drive Commercial-to-Residential Conversions

The Housing Market Is a “Crapshoot,” According to One Leading Real Estate Expert

Austin-based Student Housing Startup Seeks to Create the eHarmony of Student Living

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About Apartment Wire
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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SEPTEMBER

2014 NMHC Fall Board of Directors and Advisory Meeting
September 16-18 , 2014
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2014 NMHC Student Housing Conference & Exposition
September 30 - October 2, 2014
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NOVEMBER

2014 NMHC Optech Conference & Exposition
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November 19, 2014
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Multifamily Market Dashboard

Rental Supply Is Catching Up with Strong Demand, But Not for Affordable Units

The Harvard Joint Center for Housing Studies’ Elizabeth La Jeunesse digs deeper into the JCHS’s State of the Nation’s Housing report to look at the rental market boom’s fundamentals.

Rental demand has surged as the U.S. added roughly 740,000 new, net renter households per year from 2005 to 2013. The supply of multifamily rental units—which house over 60 percent of all renter households—has struggled to meet the demand. However, beginning in 2012, the supply-demand imbalance began to correct itself as new multifamily construction activity picked up (see figure below).

While this has contributed to a slight easing of rent pressures nationally, La Jeunesse cautions that the story line differs when you look at the numbers at the metro level or by market segment. In fact, demand for affordable units far exceeds the available supply by as many as 8.2 million units.

La Jeunesse also makes a bonus mention of NMHC Chairman Daryl Carter’s remarks on the affordability issue during the webcast release of the report.

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