Category: Real Estate

NMHC Rent Payment Tracker Finds 80.0 Percent of Apartment Households Paid Rent as of May 6

Washington, D.C. – The National Multifamily Housing Council (NMHC)’s Rent Payment Tracker found 80.0 percent of apartment households made a full or partial rent payment by May 6 in its survey of 11.7 million units of professionally managed apartment units across the country.

This is a 0.1 percentage point decrease from the share who paid rent through May 6, 2020 and compares to 81.7 percent that had been paid by May 6, 2019. This data encompasses a wide variety of market-rate rental properties across the United States, which can vary by size, type and average rental price.

“This month’s findings are part of what seems to be an increasingly clear pattern of economic recovery and strong demand for multifamily housing,” said Doug Bibby, NMHC President. “With more and more vaccines being administered, job creation on the rise and tens of billions in rental assistance being distributed to residents and housing providers in need, the outlook for the industry is a positive one.

“Federal lawmakers did their jobs when they allocated almost $50 billion in rental assistance, as well as other support for apartment residents. Now, the priority should be for local and state lawmakers to distribute those funds as quickly and efficiently as possible to residents and housing providers who have endured deep financial distress over the course of the pandemic.

“With rental assistance being disbursed, the economy on the way back and a broad return to normalcy underway across the country, it is past time for the federal eviction moratorium, a policy that was intended to be an emergency effort, to be concluded.”

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    How Will Remote Work Affect Housing After the Pandemic?

    One in four American workers expect that they will continue to have either partial or complete remote-work flexibility after the pandemic, and a majority believe that remote work flexibility will have an impact on their housing preferences and location, according to a report from Apartment List.

    “In a survey of 5,000 employed adults across the U.S., we found that four-in-10 workers expect to have some form of continued remote-work flexibility post-pandemic. Nineteen percent expect to have a hybrid arrangement that allows for remote work multiple days per week, while 21 percent expect that they’ll have the ability to work exclusively remotely,” Apartment List said in the report.

    Apartment List Housing Economist Chris Salviati said, “I would say that this report provides a lot of valuable new data to confirm trends that we’ve been hypothesizing about for a while. Namely, a broad embrace of remote work will be an ongoing long-term trend that will outlast the pandemic, and this newfound geographic flexibility will have a direct impact on where these remote workers choose to live” and housing after the pandemic.

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      What Does It Take for Multifamily to Go Passive?

      Here are several considerations that development teams should keep in mind, says Nate Thomas of The Architectural Team Inc.

      As leaders in the multifamily sector seek to cut carbon emissions and meet ever-more-stringent energy codes, the highly efficient standard known as Passive House has gained new ground.

      With diverse benefits ranging from lower ongoing operating costs to greatly enhanced occupant comfort, the pursuit of the Passive House standard is indeed a tantalizing prospect. And yet, when it comes time to plan the next big project, many development teams find themselves facing more questions than answers.

      For those considering a Passive House multifamily project, how does this innovative approach, better known for its use in high-end, single-family homes, really impact the planning, design, and construction process for large-scale properties serving dozens or even hundreds of residents?

      Here are several considerations that any development team should keep in mind when contemplating this path.

      WHAT DOES PASSIVE HOUSE MEAN FOR MULTIFAMILY?

      A Passive House building’s high performance depends on its exacting tolerances—a tight envelope with continuous insulation and high-performing openings, efficient appliances and fixtures, and often, some level of on-site power generation such as a photovoltaic array.

      With relatively compact layouts and a high occupant density, apartment and condominium buildings are well suited to the Passive House approach—especially the midrise wood-frame structures that predominate nationwide and have an inherent ability to mitigate thermal bridging issues.

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        Federal Agencies Warn Large Landlords About Tenants’ Pandemic Protections

        Two federal agencies have issued letters warning large landlords, who collectively own more than two million housing units, of federal protections in place to keep tenants in their homes and stop the spread of COVID-19, according to a release.

        The Consumer Financial Protection Bureau (CFPB) Acting Director Dave Uejio and Federal Trade Commission (FTC) Acting Chairwoman Rebecca Kelly Slaughter sent notification letters to the nation’s largest apartment landlords. A recent CFPB report found that renters are particularly endangered, with more than 8.8 million tenants behind on rent.

        “With millions of families nationwide at risk of eviction, it’s vital that landlords and the debt collectors who work on their behalf understand and abide by their obligations,” Slaughter said. “We are continuing to monitor this area and will act as needed to protect renters.”

        “Landlords should ensure that [Fair Debt Collection Practices Act (FDCPA)]-covered debt collectors working on their behalf, which may include attorneys, notify tenants of their rights under federal law. Nearly nine million households are at risk of eviction due to the economic effects of COVID-19, but no one should lose their home without understanding their rights,” Uejio said. “We will hold accountable debt collectors who move forward with illegal evictions.”

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          5 Trends Shaping the Future of Rental Housing After the Pandemic

          There are five trends witnessed during the pandemic that will be shaping the future of rental housing and apartments for years to come, according to National Apartment Association (NAA) President and CEI Bob Pinnegar.

          “The world continues to change as vaccines roll out. During the past year, businesses have adapted, consumers have altered purchasing habits and industries are adjusting to a new normal. The rental housing industry is no different, and apartments will continue evolving in response to the pandemic,” Pinnegar said in a release.

          Here is what Pinnegar said about the five trends he sees, in a recent Washington Post column.

          No. 1: A new outlook on amenities

          “There has been a shift in the amenity world—shareable areas to individual spaces.

          “Shared spaces such as fitness centers and pools are still important, but communities have shifted their focus to in-home amenities like larger kitchens, balconies, in-unit washer and dryers and high-speed Wi-Fi.”

          No. 2: Virtual tours and decision making

          “For obvious reasons, there’s now a larger number of prospective residents virtually searching for new homes.”

          While it was previously only part of the process of selecting a new community, virtual touring has been a catalyst to “invest in new technology, high-quality videos and specialized training to give prospects a more complete picture of the community.”

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            Top 10 Markets for Self Storage Construction

            As of March, some 126 million square feet of storage space was underway or in the planning stages across the U.S., Yardi Matrix data shows.

            The self storage sector maintained its strength throughout the first quarter of 2021, with continued positive street-rate performance and steady development activity across the country. Despite the rising cost of construction materials, self storage developers continued to add new projects to the pipeline.

            As of March, more than 125.7 million square feet of self storage space was under construction or in the planning stages across the U.S., accounting for 8.4 percent of the nation’s total inventory, up 20 basis points month-over-month, according to Yardi Matrix data.

            The table below highlights the top 10 markets for self storage construction, ranked by total square footage under construction or in the planning stages as of March 2021.

            Rank Metro Under Construction + Planned SF Percentage of Stock
            1 Phoenix 4,403,920 13%
            2 Orlando 2,723,743 11.1%
            3 Las Vegas 2,640,682 14.7%
            4 Central New Jersey 2,569,287 21.1%
            5 Southwest Florida Coast 2,539,216 14.5%
            6 San Fernando Valley – Ventura County 2,460,172 13.3%
            7 Fort Worth 2,445,617 10.3%
            8 Tampa – St. Petersburg – Clearwater 2,400,997 8.9%
            9 Sacramento 2,335,268 13.2%
            10 San Diego 2,295,792 12.7%

            Source: Yardi Matrix

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              Marketing Manufactured Housing Communities During the Pandemic

              Valerie Lombardi of Ascentia Real Estate shares strategies for working in unprecedented conditions and changing the misconceptions about MHCs.

              The manufactured housing industry has been coping with the effects of the pandemic better than most sectors have due to a combination between the ever-growing need for affordable housing and the limited new supply, most experts agree.

              Although fundamentals remained strong, those managing and marketing manufactured housing properties had to tailor their strategies to keep both tenants and employees safe, while also maintaining operations at a normal level. Ascentia Real Estate Holding Co. Marketing Director Valerie Lombardi told Multi-Housing News that the company quickly adjusted to working in an unknown environment. In the interview below, Lombardi expands on the unique issues the manufactured housing industry is facing, and discusses what owners and managers can do to break the stigma.

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                Renters Seek Out Affordable Alternatives

                According to the latest Assurant survey, many renters either became roommates or moved into more affordable units due to COVID-19.

                An Assurant survey showed that nearly 75 percent of renters shifted towards more affordable rental options during the pandemic.

                In the firm’s latest Multifamily Housing Renter Perspective Study, 40 percent of 608 renters surveyed between Jan. 20 and 26 said they relocated to more affordable units.

                The survey also showed that another 34 percent of renters moved into another unit as a roommate for a more affordable living situation. When asked if renters would renew their lease if the lease terms were shortened and rent stayed the same, 78 percent of renters said they would.

                Assurant’s survey also showed that 46 percent of participants needed rent relief in 2020, with another 24 percent adding that they would definitely need rent relief in the next three months.

                Last year, the survey was released in June and showed that 42 percent of renters were unsure about their rental stability going forward.

                In this year’s survey, 68 percent of property management companies and landlords reported that they are still implementing COVID-19 plans whether that be in the form of safety or financial issues.

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                  Lack of Home Supply, Rising Costs Keep Renters in Place

                  The latest Marcus & Millichap report finds market conditions that should be beneficial for multifamily properties.

                  Multifamily renters who may be looking to buy a home are finding tight supplies, escalating prices and increasing financing costs. Those market conditions mean the demand for multifamily rentals will remain elevated, according to a new research brief by Marcus & Millichap.

                  The report noted the number of existing houses listed for sale in February was down 32.6 percent year-over-year, the largest annual drop ever recorded. The few listings were snatched up quickly with homes staying on the market an average of 20 days, also a new low.

                  The lack of homes available for sale come at the same time prices to buy a house, both existing and new, are rising along with increasing financing costs. The April research brief states the median price of an existing home was up 16.2 percent year-over-year in February to $334,500.

                  New home prices rose 5.5 percent to a median price of $347,200. The report notes the 30-year mortgage rate rose above 3.1 percent in the past few weeks, up 40 basis points since early January.

                  Rising costs of labor and materials, particularly lumber, are also contributing to higher home prices. Higher lumber prices have added an estimated $24,000 over the past year to the cost of a new home, according to the National Association of Home Builders.

                  The combination is keeping more potential homebuyers out of the market, particularly to many renters who may be looking for homes priced less than $250,000.

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                    Will You Be Ready When the Eviction Moratorium Ends?

                    By David Pickron

                    Recently I was at a birthday party where young children were participating in some old-fashioned games. One that struck me particularly was musical chairs. As an adult, I now realize the anxiety that was generated by that game; will I be left out or will I be the last one standing? As each round progressed and more players and chairs were removed, I could see that unique mixture of fear and fun fill the faces of these children as they competed to be the last person with a chair to call home.

                    Over the past year in meeting with landlords across the country, I have come to know that look all to well as we have tried to navigate the eviction moratorium that has affected our industry. You may have even seen that face in your mirror this morning.

                    As March 2021 ended, once again the eviction moratorium was continued to June 30. For most of us I don’t think this came as any great surprise. Even though the legislature approved rental relief for affected landlords, there just wasn’t enough time to get that money out to landlords (these are the same people who were able to get PPP business loans out and funded within weeks). I predict that this will be the last extension and I’m already prepared for many of you to let me have it if I am wrong. I hope and pray I am right. Let’s assume that I am right, and that the eviction moratorium completes its run at the end of June. The rental-housing market will immediately be thrust into an unforgiving version of adult musical chairs.

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