March 31, 2017
RealPage division Axiometrics reported U.S. apartment occupancy at 94.5% during Q1 2017, down from the 95.1% reported in the previous quarter. Demand from the last two quarters fell more than 100,000 units short of deliveries totaling 164,549 units, according to the Axiometrics data. Axiometrics also reports that 581,556 apartment units are under construction across the country now. Annual rent increase was reported at 3.7%.
Top-tier existing projects are losing momentum for the first time in the current market cycle, according to Jay Denton, with RealPage’s Axiometrics business group. “Some renters from established luxury projects are opting for the newest deliveries, in order to take advantage of rent discounts often offered during the initial lease-up process,” he said.
Meanwhile, RealPage chief economist Greg Willett indicated that new household formation, bolstered by above-average job production, should help keep apartment demand strong. “Economic and demographic influences that stimulate apartment absorption are moving in the right direction,” he added.
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