Marcus & Millichap: 'Intense demand' for Austin apartmentsMarcus & Millichap: 'Intense demand' for Austin apartmentshttps://www.recenter.tamu.edu/news/newstalk-texas/?Item=153862016-12-06T06:00:00Z2016-12-06T17:00:00Z​​AUSTIN – Population and job growth will support record absorption this year as vacancy for local apartment buildings remains near 4 percent, reports Marcus & Millichap in its fourth quarter market report.

​"Household formation during the past several years has favored apartments as home prices rose at a faster pace than rents," the report said. "As a result, renting has remained the more affordable option, especially in high-density areas such as the core, where builders added thousands of units over the past five years. Vacancy has dropped below 4 percent in southern and northern submarkets, and developers are beginning to shift their focus to these areas.

"Rent advances will be healthiest outside the core through the remainder of the year and into 2017 as vacancy remains tight, though the pace of overall rent growth will slow.

"As home price appreciation rises at a healthy clip, the gap between owning and renting will widen, keeping demand for area apartments strong in the months to come.

"Investor demand is rising for Austin apartment assets as tight vacancy and healthy rent growth spur intense interest from a wide range of buyers. Fewer active listings and healthy competition are pushing up apartment prices.

"Vacancy has tightened across all property classes, diminishing the number of value-add properties available on the market. As a result, private buyers are targeting Class B/C stabilized deals in the $1 million to $10 million range."
Marcus & Millichap Real Estate Investment Services
Austin-Round Rock
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