Rents Growing Five Percent Yearly, More In Some Florida Cities
By Bobby Freeman, Realtor // May 21, 2015
streak not seen for almost four years
BREVARD COUNTY, FLORIDA – Rent growth in the national apartment market is on a streak not seen for almost four years, according to Axiometrics.
Annual effective rent growth for the U.S. apartment market in April 2015 remained steady at five percent.
It’s the third straight month it has been at or above five percent, and it’s the highest April rate since at least 2009, when Axiometrics began reporting the metric monthly.
In the first three months of the year, rents grew at their highest rate since the third quarter of 2011.
“We receive numerous inquires from clients looking for rental accommodations, both for short term and long term durations in Brevard County,” said Realtor Sal Burke and Property Manager for RE/MAX Elite’s McCoy-Freeman Group.
“With the high demand of corporate inquires, we have a situation where the demand far out weighs the supply for the moment.”
Stephanie McCleskey, Axiometrics Vice President of Research said, “Though the rate of rent growth has been steady the past several months, the fact that rents are rising at a 5 percent annual clip points to an extremely robust apartment market,” says
“The absorption of the large amount of new supply, fueled by increasing job gains, has been a boon for landlords and property owners – not to mention apartment investors.”
Annual effective rent growth did not reach 3 percent until March 2014, 4 percent until August 2014, and 5 percent until December 2014.
“If the market sustains this trend of 5 percent rent growth, 2015 would exceed the surprisingly strong year of 2014 as the highest-performing year of the recovery,” McCleskey says.
“However, we still believe that rent growth rates will moderate as the year progresses.”
The national occupancy rate was 95.2 percent in April, an increase from March’s 94.9 percent. Occupancy last reached 95.2 percent in August 2014, the first time it had attained this level since Axiometrics began reporting occupancy rates monthly in April 2008.
“Axiometrics considers properties and markets full at 95 percent occupancy,” McCleskey says.
“So, in essence, the national apartment market is full and in need of even more new supply, even though a record number of new units have been identified for delivery this year. Of course, individual markets differ, and there are some metro areas in which new supply is exceeding demand; but overall, the outlook is strong for the apartment industry.”
Florida Cities’ Rent Growth
Eight California markets were among the top 17 markets with the highest annual effective rent growth in April within Axiometrics’ top 50 markets, based on total units, but three Florida cities ranked near the top of the list in April for effective rent growth:
• Orlando: 6.7% rent growth, 95.6% occupancy rate
• West Palm Beach: 6.4% rent growth, 95.5% occupancy rate
• Fort Lauderdale: 6.3% rent growth, 95.8% occupancy rate
In addition, Axiometrics noted other hot markets that saw even higher percentage increases, including:
• Naples: 10.2% rent growth, 97.7% occupancy
• Cape Coral: 10.2% rent growth, 97.3% occupancy
• Deltona: 9.0% rent growth, 96.5% occupancy
Orlando had the biggest rise among the top 17 markets in April, moving from No. 15 in March to No. 10 in April; West Palm Beach had the steepest decline, dropping from eighth place in March to No. 14 in April.
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ABOUT THE AUTHOR
Bobby Freeman, a life-time resident of Brevard County, has been a top Realtor in the area for two decades. In his first year as an agent, Freeman received a Rising Star award from his Brokers. Since then he has achieved numerous sales awards and has recently been presented with the prestigious RE/MAX Hall of Fame Award.
Freeman, Jennifer McCoy and Nikki McCoy Freeman are family partners for RE/MAX Elite’s McCoy-Freeman Group. Together they have more than 30 years of extensive experience in all aspects of the real estate industry and have sold over $200 million.
Among McCoy-Freeman Group’s achievement are RE/MAX Hall of Fame, RE/MAX 100% Club, Certified Distressed Property Experts (CDPE), Accredited Buyer’s Representative (ABR) and voted Best Realtor in Brevard County.
The group has been featured in many news publications including CNN Money Magazine, CNNMoney.com, WFTV 9 ABC News, Coastal Condo Living, & Hot Retirement Towns Magazine and SpaceCoastDaily.com.
For more information log on to BrevardRealtyConnection.