Press Release (ePRNews.com) - LOS ANGELES - Jul 17, 2017 - The current number of markets in the “Sell Phase” is thirty-nine, according to Eugene E. Vollucci, Director of CRES. The number of markets in the “Buy Phase” is fifteen. Mr. Vollucci states, “This quarter the three top buy recommendations are Davenport, IL, Peoria, IL and Greensboro, NC. The three top sell recommendations are Baltimore, MD, Grand Rapids, MI and Tacoma, WA.” according to Mr. Vollucci.
In this edition of our “Market Cycles,” the national vacancy rate in
the first quarter 2017 was 7.0 percent for rental housing. The rental vacancy rate of total nonfarm employment in the U.S. increased by a net 2.45 million jobs during the last four quarters. Workforce headcounts grew 1.7% in 2016, a downshift from a 2% expansion recorded during the preceding year The 7.0 percent rental housing rate was virtually unchanged from the rate in the first quarter 2016 and not statistically different from the rate in the fourth quarter 2016 ,
The first quarter 2017 rental vacancy rate was highest outside Metropolitan Statistical Areas (8.7 percent). The rates inside principal cities (7.0 percent) and in the suburbs (6.5 percent) were not statistically different from each other. The rental vacancy rates outside principal cities and in the suburbs were not statistically different from the first quarter 2016 rates.
The first quarter 2017 rental vacancy rate was highest in the South (8.8 percent), followed by the Midwest (7.8 percent), Northeast (5.7 percent) and West (4.7 percent). The rental vacancy rates in the Northeast, Midwest, South and West were not statistically different from the first quarter 2016 rates.
The Bureau of Labor Statistics reported that the total nonfarm payroll employment increased by 222,000 in June, and the unemployment rate was
little changed at 4.4 percent. In June, the unemployment rate, at 4.4 percent, and the number of unemployed persons, at 7.0 million, were little changed. Since January, the unemployment rate and the number of unemployed are down by 0.4 percentage point and 658,000, respectively. The number of long-term unemployed(those jobless for 27 weeks or more) was unchanged at 1.7 million in June and accounted for 24.3 percent of the unemployed. Over the year, the number of long term unemployed was down by 322,000.
The labor force participation rate, at 62.8 percent, changed little in June and has shown no clear trend over the past year. The employment-populationratio(60.1 percent) was also little changed in June and has held fairly steady thus far this year.
The number of persons employed part time for economic reasons(sometimes referred to as involuntary part-time workers), at 5.3 million, changed little in June. These individuals, who would have preferred full-time employment, were working part time because their hours had been cut back or because they were unable to find a full-time job. In June the 1.6 million marginally attached persons to the labor force was down 197,000 from a year earlier.
We predict that because of rising employment in recent years, developers will increase multifamily construction. Rents are expected to rise to 2% again this year, with average rent reaching $847 per month. Renters are anticipated to occupy 300 additional apartments in 2017 compared to the 209 units projected to come online. The entire new inventory will be in the Northwest submarket.
ABOUT THE AUTHOR: Eugene E. Vollucci, is the Director of The Center for Real Estate Studies, a real estate research center He is author of four best selling books and many articles on rental income investing, apartment investing, real estate and taxation. To purchase a subscription to Market Cycles and to learn more about the Center for Real Estate Studies, please visit us at http://www.calstatecompanies.com
The Center For Real Estate Studies