Download 2017 National Single-Family Rental Research Report

2017 National
Single-Family Rental
Research Report
To Our Valued Clients,
We are pleased to present our 2017 Single-Family Rental Report to help guide your successful real estate investment strategy this
year. In this report, we share the results of our extensive research on major markets, economic conditions, and other factors that
influence the balance of risk versus reward on single-family rentals across the country. We’re confident that the right single-family
investment assets are available for you, regardless of your financial goals.
Historically low interest rates in 2016 enabled investors to acquire cash-flowing properties with leverage in metros across most of
the country despite the continued volatility in the stock market. Strong rental growth in many markets, combined with an ongoing
preference among the U.S. population for rental living pushed vacancies down, while appreciation outpaced inflation.
The outlook remains positive for 2017, although rent growth in some major coastal markets will be subdued relative to last year’s
levels. Elsewhere, supply and demand for rental properties nationwide will result in another solid year for investors. The economic
recovery will continue to generate hundreds of thousands of new households this year, creating an unprecedented demand for
single-family rentals, especially as single-family construction levels remain tempered compared to boom periods.
The Fed will likely raise interest rates throughout the year in an effort to normalize monetary policy. By the end of 2017, we expect
interest rates to climb approximately 75 basis points, but remain relatively low. Inflationary concerns that arose when the new
President took office will place upward pressure on 10-Year Treasuries. To take advantage of healthy conditions, we believe acquiring properties during the first half of the year would protect your existing portfolio and help build wealth over the long term.
Sincerely,
Stephen Hovland
Director of Research and Communications
Table of Contents
National Overviews
Single-Family Rankings�����������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������4-5
National Economic Overview��������������������������������������������������������������������������������������������������������������������������������������������������������������������������������� 6
National Single-Family Overview���������������������������������������������������������������������������������������������������������������������������������������������������������������������������7
National Single-Family Investment Overview�����������������������������������������������������������������������������������������������������������������������������������������������������8
Capital Markets Overview��������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������� 9
Local Overviews
Atlanta�������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������10
Austin���������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������� 11
Boston��������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������� ..........12
Charlotte .................................................................................................................................................................................................................... 13
Chicago����������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������� 14
Cleveland�������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������� 15
Columbia .....................................................................................................................................................................................................................16
Dallas/Fort Worth������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������ 17
Denver .........................................................................................................................................................................................................................18
Detroit. .........................................................................................................................................................................................................................19
Houston����������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������20
Indianapolis .............................................................................................................................................................................................................. 21
Inland Empire ........................................................................................................................................................................................................... 22
Jacksonville��������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������� 23
Las Vegas������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������ 24
Los Angeles ............................................................................................................................................................................................................. 25
Memphis��������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������26
Miami ..........................................................................................................................................................................................................................27
Oakland����������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������28
Orange County..........................................................................................................................................................................................................29
Orlando ......................................................................................................................................................................................................................30
Phoenix ......................................................................................................................................................................................................................31
Portland ..................................................................................................................................................................................................................... 32
Raleigh-Durham������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������� 33
San Antonio .............................................................................................................................................................................................................. 34
San Diego ..................................................................................................................................................................................................................35
San Francisco ...........................................................................................................................................................................................................36
San Jose ....................................................................................................................................................................................................................37
Seattle ........................................................................................................................................................................................................................38
Tampa������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������� 39
Investor Information
Research Services and Investment Locations�������������������������������������������������������������������������������������������������������������������������������������������������40
Contacts���������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������� 41
Single-Family Rankings
OPPORTUNITY RANKING
Opportunity Ranking
MSA
Atlanta
Orlando
Seattle
Las Vegas
Chicago
San Diego
Oakland
Detroit
Dallas-Fort Worth
Memphis
Rank
1
2
3
4
5
6
7
8
9
10
OPPORTUNITY MARKETS
$550
Two major metros in the Southeast earned top billing on this
list: Atlanta and Orlando. Both metros continue to benefit
from strong job growth, and an exodus of retirees trading
cold-weather climates for warmer alternatives. Seattle, with
a booming, diverse economy fueled by Amazon and other
high-tech companies, placed third on this list. Rounding out
the top five are Las Vegas and Chicago, metros that were
latecomers to the economic recovery. Opportunities have also
arisen for savvy investors in two California markets – Oakland
and San Diego. While both metros feature high median
home prices relative to the other metros on this list, their
expanding economies ensure solid long-term appreciation
as prospects for strong rent growth remain intact. High rental
yields and low prices propelled Detroit and Memphis into
the top 10, while a well-rounded economy featuring a large
financial services presence enabled Dallas to secure a spot.
4%
JOB GROWTH FORECAST 2017
$425
3%
$300
2%
$175
1%
$50
0%
s
s
do ttle ega cago Diego land troit llas
a
phi
k
i
ant Orlan Sea as V
Da Mem
De
Oa
Ch San
Atl
L
JOB GROWTH
MEDIAN HOME PRICE (000S)
INVESTMENT PRICE
Markets in the Opportunity Ranking provide a strong balance
of supply/demand fundamentals while offering favorable
entry prices and limited threats. The metros highlighted in
this ranking were measured using cap rates and entry prices,
as well as projected job growth in 2017. Markets with high
construction are penalized in the opportunity ranking due to
elevated risk of competition.
MARKET
High-Demand Ranking
MSA
Seattle
Oakland
San Diego
Orlando
Las Vegas
Los Angeles
Atlanta
Boston
Austin
Raleigh
HIGH-DEMAND RANKING
Rank
1
2
3
4
5
6
7
8
9
10
The Strongest Rental Demand Ranking looks at metros with
the most favorable supply/demand forecasts regardless
of projected returns in 2017. These markets boast strong
job growth, low vacancy, high projected rent gains and
limited threat from renters purchasing high-priced homes.
Furthermore, the number of jobs per newly issued permit
is considered to serve as a hedge against the prospect of
overbuilding.
Major California port cities with growing infrastructure for the
trade, transportation and utilities sector, earned prominent
mentions on this list. These metros – Oakland, San Diego and
Los Angeles – along with the top metro of Seattle have among
the strongest job markets in the country, and the highest rent
growth forecasts this year. Increasingly out-of-reach prices –
for both investment and traditional homes – has limited the
buyer pool. Other supply-constrained markets earning top
spots in this year’s ranking include Boston and Austin. Thriving
hospitality and tourism sectors drive the rental markets of
Orlando and Las Vegas, while the mild climates of Atlanta and
Raleigh, N.C., are drawing renters of all ages to the Southeast.
HIGH-DEMAND MARKETS
8%
2017 VACANCY FORECAST
2017 RENT GROWTH FORECAST
8%
6%
VACANCY
4%
4%
2%
0%
2%
o
o
h
ta
es
e
n
as
in
attl kland Dieg rland Veg ngel Atlan osto Aust aleig
B
R
O Las os A
Oa San
L
RENT GROWTH
6%
0%
Se
MARKET
4
Single-Family Rankings
CAP RATE RANKING
Cap Rate Ranking
MSA
Cleveland
Columbia
Memphis
Philadelphia
Atlanta
Chicago
Jacksonville
Tampa
Charlotte
Detroit
Cap rates, or net operating income divided by price, historically
have been difficult to discern due to the prevalence of traditional
home sales in the market. By utilizing prices of investmentonly properties, average rents for those assets, and consistent
operating costs, average cap rates can be derived for singlefamily rentals. For the second consecutive year, HomeUnion
has captured actual first-year returns, providing a clear view of
the state of each metro’s investment market.
HIGH-YIELD MARKETS
12%
CAP RATE
CAP RATE
20%
GROSS RENTAL YIELD
9%
15%
6%
10%
3%
5%
0%
0%
e
lle
a
it
bia phis lphia lanta icago
and
nvi amp arlott etro
vel Colum Mem ilade
D
T
At
h
Ch ackso
C
h
Cle
J
P
GROSS RENTAL YIELD
Stable markets occupy several spots in the Cap Rate ranking.
Some of the hardest-hit housing markets finally turned the
corner after the recession, earning spots in this ranking
after seven years of national economic expansion. The Rust
Belt cities of Cleveland and Detroit are prime examples,
while Philadelphia, Atlanta, Tampa and Jacksonville were
also once laggards to the recovery, but have overcome
high foreclosure levels to emerge as strong markets for
yield-seeking buyers. The southeastern cities of Columbia,
Memphis and Charlotte appear in the ranking as well due
to low investment home prices. Perpetually insulated by
the fluctuations in pricing that impacts coastal markets, the
Midwestern city of Chicago earned a spot in the middle
of this ranking as its employment sector rebounds, rental
growth remains stable, and home prices are still affordable.
Rank
1
2
3
4
5
6
7
8
9
10
MARKET
Upside Potential Ranking
UPSIDE POTENTIAL RANKING
MSA
Chicago
Las Vegas
Orlando
Miami
Fort Lauderdale
Atlanta
West Palm Beach
Philadelphia
Phoenix
Minneapolis
Although traditional home prices in many markets have nearly
recaptured all of the value that evaporated during the housing
downturn, some investment markets have been slower
to recover for a number of reasons. By examining solely
investment assets rather than all home sales, markets where
more upside is present becomes clear.
MEDIAN INVESTMENT PRICE (000S)
PRICING DISCOUNT FROM PEAK
$400
PRICE
DECLINE
$300
30%
$200
20%
$100
10%
$0
ia
lis
le
a
ch
go egas ando iami
rda tlant Bea delph oenix eapo
V Orl
A
M aude
lm Phila
Ph Minn
a
Las
L
P
.
Ft
ica
Ch
MARKET
5
40%
0%
DECLINE FROM PRIOR PEAK
More than half of the metros in this ranking were among the
most overheated housing markets in the middle of the last
decade, which resulted in a larger climb for prices to recover.
Within this category are Las Vegas, Orlando, Miami, Fort
Lauderdale, Palm Beach and Phoenix. The local economies
of many of these metros are outperforming the nation as a
whole, pushing valuations upward. Chicago, which tops this
list for the second year in a row, was one of the last economies
to emerge from the recession, creating a longer timeline for
prices to rise. Low entry prices for SFRs in the historically
stable eastern seaboard cities of Atlanta and Philadelphia
make them attractive prospects for investors. In the near
term, continued low vacancy in Minneapolis, along with a
strengthening economy, will reward investors.
Rank
1
2
3
4
5
6
7
8
9
10
National Economic Overview
U.S. ECONOMIC GROWTH POISED TO CLIMB IN 2017
AS JOBS AND CONSUMER SPENDING PROVIDE LIFT
QUARTERLY CHANGE
10
TRAILING 12-MONTH
6
5
3
0
0
-5
-3
-10
-6
93
97
01
05
09
13
TRAILING 12-MONTH AVERAGE
QUARTERLY CHANGE (SAAR)
GROSS DOMESTIC PRODUCT
The U.S. economy rides a wave of optimism into 2017, fueled
by the speculation that restrictions on business operations
will abate under a new Presidential administration. Even prior
to the election, the economy appeared to be on stronger
footing. In the second half of 2016, economic growth was
approximately triple the expansion recorded in the first six
months of the year. Many of the headwinds that stunted
development calmed during the final two quarters, including
Brexit and concerns about economic growth in China. Oil
prices, meanwhile, stabilized as the supply glut began to
dissipate. As a result, job losses in the oil and gas extraction
sector ceased at the beginning of the third quarter. Overall, the
mining and logging sector lost more than 200,000 jobs from
peak to trough, including nearly 30,000 oil and gas extraction
positions. Unimpeded by the energy sector, the U.S. economy
managed to add 2.2 million positions last year.
17*
YEAR
*Forecast
EMPLOYMENT CHANGE
6
UNEMPLOYMENT RATE
10%
3
8%
0
6%
-3
4%
-6
UNEMPLOYMENT RATE
EMPLOYMENT CHANGE (MILLIONS)
EMPLOYMENT CHANGE VS. UNEMPLOYMENT
Several factors will contribute to stronger economic growth in
2017. Consumer confidence, a leading indicator of future retail
sales, reached a 15-year high at the end of 2016. Consumer
spending accounts for a significant share of GDP, which will
help facilitate a 2.5 percent expansion in the economy this year.
Big ticket items, including those associated with household
formation, will make up a significant share of consumer
spending. Many of these new households will be created by
millennials, who are making headway in the job market. Last
year, 11.2 percent of adults lived with their parents, the highest
rate since 1994. At the beginning of the most recent recession,
only 10.1 percent of adults lived at home. Overall, 2.7 million
more adults are living at home now than were historically.
2%
93
97
01
05
09
13
17*
YEAR
*Forecast
OIL PRICES AND JOBS
OIL AND MINING JOBS
20
OIL PRICES
$150
JOBS (OOOS)
$120
4
$90
-4
$60
-12
-20
PRICE PER BARREL
12
2017 ECONOMIC OUTLOOK
GDP is anticipated to grow 2.5 percent during in 2017. The
momentum gained in the second half of last year will help
the national economy expand at the fastest pace since 2015.
Consumer spending related to household formation will be
one of the primary catalysts of a stronger economy.
$30
08
10
12
14
16
YEAR
$225
MEDIAN HOME PRICE
CONSUMER CONFIDENCE
$200
100
$175
75
$150
50
$125
After slipping to 1.5 percent during 2016, payroll expansion
is projected to rise to 1.7 percent this year. Employers are
forecast to add 2.5 million jobs this year, led by professional
and business services, and leisure and hospitality.
125
CONSUMER CONFIDENCE
MEDIAN HOME PRICE (000S)
MEDIAN HOME PRICE VS. CONSUMER CONFIDENCE
Energy will move from being a drag on the economy to a
neutral position. After OPEC and Russia reached an output
agreement, West Texas Intermediate crude oil prices are
forecast to hover between $50 and $70 per barrel, stemming
the tide of job losses in the sector.
25
08
09
*Through 3Q 2016
10
11
12
13
14
15
16
YEAR
6
National Single-Family Overview
CLASS B AND C RENTALS POISED FOR A STRONG
YEAR; NEW APARTMENTS PARE PERFORMANCE IN
CLASS A SECTOR
PERMITS
1200
UNITS (000S)
The national SFR market will remain healthy in 2017, though
increased competition from a wave of new apartments will
slow the pace of improvement. Nonetheless, vacancy will
continue to tighten on a national basis, reaching the lowest
level of the current cycle. According to recent data available
from the U.S. Census Bureau, 805,000 households were
formed in 2016. Of those, 434,000 were renter households.
Strong job growth will encourage new household formation,
particularly among millennials that have been living with their
parents. As most of these new households are unlikely to
enter the ownership pool, this will create demand for rental
properties. Additionally, higher home prices, limited inventory,
debt burdens and rising interest rates will limit the number
of first-time homebuyers to approximately 35 percent of the
market, well below the long-term trend of 40 percent.
SINGLE-FAMILY
MULTIFAMILY
900
600
300
0
03
04
05
06
07
08
*Through 3Q
09
10
11
12
13
14
15
16
YEAR
HOUSING STARTS
2500
1875
1250
As vacancy tightens, operators will be able to lift rents above
the inflationary rate this year. However, this trend will not
blanket the nation. Metros where high-paying jobs are met
with an influx of competitive, Class A apartments will likely see
minimal rent gains in 2017. San Francisco, San Jose and Orange
County will fall into this category. Submarkets in Oakland,
Los Angeles, San Diego and New York will meet a similar
fate as landlords are forced to operate in a hypercompetitive
environment. In less-expensive markets, where developers
have minimized their presence and attrition to homeownership
is unlikely, operators will have the strongest position to lift
rents. Metros in the Sun Belt, including the Florida, Carolina
and Texas markets are expected to post above-average rent
gains. Overall, this is likely the last year for strong rent gains in
the SFR market this cycle. Similarly, 2016 was the last year for
above-average rent gains in the apartment sector.
625
0
80
84
88
92
96
*Through 3Q
00
04
08
12
16*
YEAR
HOMEOWNERSHIP RATE
72%
69%
66%
63%
60%
00 01 02 03 04 05 06 07 08 09 10
2017 SFR OUTLOOK
*Through 3Q
11
12
13
14
15 16*
YEAR
Housing starts will remain well below peak levels. Builders
are limiting activity due to low margins for entry-level homes
and high land costs.
VACANCY & RENT
SFR RENT
$2,000
MONTHLY RENT
Competition will limit rent gains. Asking rent growth will slow
to 3.5 percent in 2017. Some of the markets with previously
strong performance are expected to show evidence of
plateauing rents this year.
VACANCY
12%
$1,500
10%
$1,000
8%
$500
$0
6%
09
*Forecast
7
10
11
12
13
YEAR
14
15
16
17*
VACANCY
Vacancy will reach a cyclical low. SFR vacancy is projected
to decrease 30 basis points to 6.4 percent. Submarkets with
a high number of new apartments could see a rise in vacancy.
National Investment Overview
RETAIL BUYERS TAKE CHARGE AS DIVERSIFICATION
DRIVES INVESTMENT ACTIVITY IN 2017
INVESTMENT SALES VELOCITY
UNITS (000S)
300
RETAIL
INSTITUTIONAL
The SFR investment class remained attractive to buyers in
2016 as low interest rates and uncertainty in other investment
vehicles encouraged diversification. Interest rates fell to a
cyclical trough during the midst of the spring buying season,
while concerns about the United Kingdom’s vote to leave the
European Union erased billions in global equity within hours.
As the markets slowly recovered, investors realigned their
portfolios into real estate to take advantage of the low cost of
capital and stable returns. Moreover, investors wary of future
volatile swings in the global markets and facing pending
retirement transitioned to safety plays rather than relying on
enthusiasm in the stock market. Immediately following the
U.S. election, for example, stock futures plummeted. The
turnaround in the equities markets was almost immediate
and resulted in a two-month rally. Although the stock market
recently reached an all-time high, concerns about the ongoing
strength of the current bull market pushed capital into rental
assets.
225
150
75
0
07
08
09
10
11
*Through 3Q 2016
12
13
14
15
16*
YEAR
MEDIAN HOME PRICE
$200
Y-O-Y CHANGE
20%
$150
10%
$100
0%
$50
-10%
$0
YEAR-OVER-YEAR CHANGE
MEDIAN HOME PRICE (000S)
INVESTMENT HOME PRICE TRENDS
Most of the transactions last year were executed by retail
buyers attempting to diversify their portfolios. The large
institutions, which purchased thousands of homes during the
downturn, continued to reposition their holdings to maximize
efficiency. Additionally, institutions are profit-taking with
some of their management-intensive assets, which were
acquired at fire-sale prices. Investors purchasing properties
being discharged by the REITs and institutions may face
similar management challenges in the coming months. The
investment market is expected to transition further this year
as leveraged deals outnumber cash purchases for the first
time in a decade. Low interest rates, higher prices and the
opportunity to amplify returns support this trend. Distressed
deals, which attract cash buyers, are also disappearing due to
a stronger job market and appreciation.
-20%
07
08
09
10
11
*Through 3Q 2016
12
13
14
15
16*
YEAR
LEVERAGED VS. CASH PRICES
LEVERAGED SALES
$250
CASH SALES
$200
$150
$100
$50
06
07
08
09
*Through 3Q 2016
10
11
12
13
14
15
16
YEAR
2017 INVESTMENT OUTLOOK
Velocity will take a step back as institutions remain on the
sidelines. Buy-and-hold investors will be the dominant force in
the market while flippers will find fewer deals.
LEVERAGED VS. CASH SALES
LEVERAGED SALES
80%
CASH SALES
Leveraged acquisitions are expected to surpass cash deals
for the first time since 2007. Cash purchases were very
attractive after the mortgage markets froze. Attractive rates
are luring investors willing to acquire assets with loans.
65%
50%
35%
Upward pressure on prices will continue. A shortage of
new supply will favor sellers in 2017, resulting in appreciating
values in most places.
20%
06
*Through 3Q 2016
07
08
09
10
11
12
13
14
15
16*
YEAR
8
Capital Markets Overview
FED ACTIONS EXPECTED TO INCREASE CAPITAL
COSTS FOR REAL ESTATE
FEDERAL FUNDS RATE VS. 30-YEAR MORTGAGE
FEDERAL FUNDS RATE
8%
In 2016, investors enjoyed the lowest interest rates of the
current cycle, approximately eight years after the Federal Open
Market Committee (FOMC) dropped the federal funds rate to
the “zero-bound.” Although the Fed lifted the funds rate off
the floor in December of 2015, spooked investors rushed back
into dollar-denominated assets in a flight to safety. Weakness
in emerging economies, in particular, sent a cascade of money
into U.S. Treasuries. As a result, the 10-year rate dipped into
the mid-1 percent area, below the inflation rate for a period.
However, the markets regained their footing and consumer
confidence climbed, pulling up rates during the second half
of the year. After the election, interest rates soared alongside
the stock market. Part of that gain can be attributed to the
market moving ahead of the Fed’s December 2016 hike, the
second such move in the current expansion cycle. Optimism
that moved capital from treasuries to equities contributed to
the rest of the increase.
30-YEAR MORTGAGE
6%
4%
2%
0%
02
04
06
08
10
12
14
16
YEAR
10-YEAR TREASURY VS. CORE INFLATION
CORE INFLATION
12%
10-YEAR TREASURY
8%
4%
0%
Since the beginning of 2017, some of the optimism that fueled
the market has deflated, bringing treasuries back into the
mid-2 percent area. That level is consistent with the spread
between interest rates and the fed funds rate over the past
three years. With the exception of last summer’s panic and
the late-2016 exuberance, treasuries have trended about 200
basis points above the funds rate. As the Fed resumes the
cycle of federal funds hikes this year, upward pressure on
interest rates will persist. By year-end, the Fed is anticipated
to lift the federal funds rate three times, or 75 basis points.
Those increases could push average cap rates for investment
properties downward into the low- to mid-5 percent area by
the end of the year. When coupled with rising prices in most
markets, the number of investment properties that pencil out
should decline this year. As a result, investors will need to
perform greater due diligence.
-4%
00
02
04
06
08
10
12
14
16
YEAR
10-YEAR TREASURY VS. CAP RATE
8%
10-YEAR TREASURY CONSTANT MATURITY
CAP RATE
08
14
6%
4%
2%
0%
06
07
09
10
*Through 3Q 2016
2017 CAPITAL MARKETS OUTLOOK
The FOMC announced plans in December to lift the federal
funds rate three times in 2017. The forecast matches last
year’s presumption before headwinds limited the interestsetting body to a single increase.
11
12
13
15
16*
YEAR
AVERAGE CAP RATE FOR INVESTMENT SALES
CASH SALES
8%
LEVERAGED INVESTMENT SALES
6%
FOMC chair has no intention of stepping down. Chairperson
Janet Yellen has announced her intention of remaining in her
post, providing some clarity into the direction of the committee.
4%
2%
Rising interest rates will put downward pressure on highpriced coastal home values. Although prices on the coasts
could retreat, mid-priced homes will be further out of reach for
first-time buyers in most places.
0%
05
06
*Through 3Q 2016
9
07
08
09
10
YEAR
11
12
13
14
15
16*
ATLANTA
Employment: 2.8%
YEAR-OVER-YEAR CHANGE
6%
US
The employment market in Atlanta is projected to outperform
national levels in 2017. This year, 75,000 new positions are
expected, a 2.8 percent increase over the 70,000 spots
created in 2016. Major sectors spurring the economy forward
include education and health services, as well as construction.
Another sector with a strong impact on the Atlanta economy
is the financial services sector. Insurance giant Anthem Inc.
will invest $20 million in a new software development center
in Midtown. This project will create more than 2,000 jobs
over the next few years. Additional growth drivers include
consulting firm KPMG, which is in the process of creating a
new facility that will support 200 high-tech jobs, and Equifax,
which is expanding its Midtown Atlanta headquarters. With the
addition of 1,300 new jobs, the Equifax project is expected to
have an economic impact of more than $75 million over the
next five to ten years.
3%
0%
-3%
-6%
09
10
11
12
*Forecast
13
14
15
16
17*
YEAR
PERMITS
UNITS (000S)
32
SINGLE-FAMILY
MULTIFAMILY
24
16
Demand from both traditional homebuyers and investors has
pushed up prices in the metro. For investment sales, much of
the increase has occurred in leveraged deals, where buyers
are seeking assets competitively priced with owner-occupied
homes. Cap rates for these properties finished the year in the
high-7 percent range. All-cash deals, meanwhile, recorded
a more modest gain in median price as buyers chased yield
into riskier neighborhoods. Overall, average cap rates for
investment deals ticked higher during 2016 as rents outpaced
price growth, particularly in the lower quality tranches. This
trend could continue in 2017 as rising interest rates ease
the pace of appreciation at a time when supply and demand
fundamentals favor landlords. As an investment market,
Atlanta still holds appeal for investors interested in moving up
the quality scale.
8
0
08
09
10
11
*Annualized 3Q 2016
12
13
14
15
16*
YEAR
VACANCY & RENT
SFR RENT
VACANCY
20%
$1,400
15%
$1,200
10%
$1,000
5%
$800
VACANCY
MONTHLY RENT
$1,600
MARKET OUTLOOK
0%
09
10
11
12
*Forecast
13
14
15
16
17*
• Employment: Job growth in Atlanta will outperform national
YEAR
levels as new technology positions are created. By year end,
employers are expected to add 75,000 additional workers,
an increase of 2.8 percent. Last year, payrolls climbed 2.7
percent.
INVESTMENT HOME PRICE TRENDS
MEDIAN PRICE PER SQUARE FOOT
24%
YEAR-OVER-YEAR CHANGE
$65
12%
$60
0%
$55
-12%
$50
-24%
09
*Through 3Q 2016
10
11
12
13
14
15
YEAR-OVER-YEAR CHANGE
PRICE PER SQUARE FOOT
$70
Rents: 3.5%
ATLANTA’S STRONG JOB GROWTH AND
MANAGEABLE ENTRY PRICES ATTRACT INVESTORS
EMPLOYMENT TRENDS
METRO
Vacancy: 120 bps
• Vacancy: SFR vacancy is forecast to end 2017 at 5.1 percent,
down 120 basis points annually.
• Rent: Rent growth is forecast at 3.5 percent, leaving yearend asking rents at $1,323 per month.
• Investment: Above-average job growth, declining vacancy,
attractive cap rates, and manageable entry prices will keep
investment activity elevated in Atlanta.
16*
YEAR
10
AUSTIN
Employment: 3.6%
TIES TO THE TECHNOLOGY SECTOR BUOYING JOB
GROWTH IN AUSTIN; INVESTORS UTILIZING LOW
INTEREST RATES IN LONG-TERM PLAYS
Vacancy: 80 bps
Rents: 2.0%
EMPLOYMENT TRENDS
METRO
YEAR-OVER-YEAR CHANGE
6%
Austin employment continues to expand at a blistering pace,
with 36,000 new positions expected to be added in 2017,
representing a 3.6 percent growth. The professional and
business services sector will fuel the local economy, led by
high-tech and Internet-based companies. Internet-based job
search engine Indeed plans to add 1,000 new jobs to the metro
between now and 2019. Korea-based Samsung, meanwhile,
has announced a $1 billion plan to expand its mobile chip
division, resulting in 500 direct jobs beginning in early 2017,
while video game developer Certain Affinity will add 300 new
jobs to the market between the end of the year and 2020.
Other growing employment sectors in Austin are information
and financial activities, and education and health services.
US
3%
0%
-3%
-6%
09
10
11
12
*Forecast
13
14
15
16
17*
YEAR
PERMITS
UNITS (000S)
15
Institutional buyers have largely exited the SFR market in
Austin, allowing retail investors a chance to reap the benefits
of this high-demand, growing market. Investors drawn to
this Texas metro are targeting properties desired by young
families in the technology and Internet space, while traditional
home buyers are facing higher home prices. Furthermore,
Austin investment sales are growing while owner-occupied
sales are softening, as first-time buyers are being priced out of
the market. Cap rates in this market have remained at a steady
4.7 percent for the past two years. In markets like Austin where
investment prices have increased, most investors have opted
to use leverage.
SINGLE-FAMILY
MULTIFAMILY
10
5
0
08
09
10
11
*Annualized 3Q 2016
12
13
14
15
16*
YEAR
VACANCY & RENT
SFR RENT
MARKET OUTLOOK
• Employment: Payroll levels are expected to expand to 3.6
percent this year as 36,000 positions are created. Much of
the growth will occur in the high-paying professional and
business services sector. In 2016, new hires contributed
23,0000 jobs to staffing levels.
VACANCY
20%
$1,700
15%
$1,500
10%
$1,300
5%
$1,100
0%
09
• Vacancy: Vacancy is forecast to tighten 80 basis points to
VACANCY
MONTHLY RENT
$1,900
10
11
12
13
*Forecast
14
15
16
17*
YEAR
3.9 percent.
• Rent: By year-end, asking rents are forecast to reach $1,735
INVESTMENT HOME PRICE TRENDS
PRICE PER SQUARE FOOT
$150
• Investment: With a strong technology sector, and an influx
of young talent, investors in Austin are beginning to move
up the quality scale to target properties desirable for the
prime renter demographic. First-time buyers are priced out
of the market, creating an opportunity for investors utilizing
leverage while banking on appreciation.
MEDIAN PRICE PER SQUARE FOOT
24%
YEAR-OVER-YEAR CHANGE
$125
12%
$100
0%
$75
-12%
$50
-24%
09
*Through 3Q 2016
11
10
11
12
13
YEAR
14
15
16*
YEAR-OVER-YEAR CHANGE
per month, up 2.0 percent for the year. In 2016, SFR rents
jumped 3.9 percent.
BOSTON
Employment: 2.1%
YEAR-OVER-YEAR CHANGE
6%
US
Boston’s economy continues to strengthen, pushing SFR rents
higher and vacancies lower. Local employers are expected to
add 38,000 new jobs to the market this year. The financial
services sector fueled the region’s economic expansion in
2016. The high-tech sector also employs many of the area’s
renters – from millennials to generation X. In November,
Cambridge tech firm Akamai Technologies committed to the
largest lease transaction in the state of Massachusetts in the
past three years: a 630,000-square-foot deal valued at nearly
$700 million in Kendall Square. SFR vacancy in Boston is
among the tightest in the nation, hovering just above 2 percent,
and rent growth of to 2.9 percent is expected by year’s end.
Renter demand near Harvard, MIT, and other universities in
the Cambridge submarket will enable operators to push rents
above the metro average.
3%
0%
-3%
-6%
09
10
11
12
*Forecast
13
14
15
16
17*
YEAR
PERMITS
UNITS (000S)
12
SINGLE-FAMILY
MULTIFAMILY
9
As in most coastal markets across the country, investment
activity in the Boston metro presents challenges to all-cash
investors seeking high yields. However, the total volume of
investment sales is approximately 25 percent of total sales. As
buyers remain interested in the market, many resort to using
leverage to acquire SFRs as prices continue to rise. Since
median investment prices have reached the $300,000 mark
and rent growth continues to slow, investors are readjusting
their acquisition strategies. An increasing number of buyers
are now targeting assets in suburban locations featuring higher
yields and cap rates above 5 percent. As appreciation triggers
upward price growth, this trend is expected to continue in
2017, further limiting trades of in-town SFRs. While institutional
activity in most metros has slowed, investment activity by both
institutional and retail and buyers in Boston remains steady,
spurring competition for available SFRs.
6
3
0
08
09
10
11
*Annualized 3Q 2016
12
13
14
15
16*
YEAR
VACANCY & RENT
SFR RENT
VACANCY
8%
$2,300
6%
$2,100
4%
$1,900
2%
$,1700
VACANCY
MONTHLY RENT
$2,500
MARKET OUTLOOK
0%
09
10
11
12
13
*Forecast
14
15
16
17*
• Employment: After adding 34,000 jobs in 2016, employers
YEAR
are anticipated to expand head counts by 38,000 spots this
year, representing a 2.1 percent increase.
INVESTMENT HOME PRICE TRENDS
• Vacancy: After a 60-point decline in 2016, vacancies for
$170
12%
single-family rentals are expected dropped by another 70
basis points to 2.1 percent this year.
$160
0%
$150
-12%
$140
-24%
MEDIAN PRICE PER SQUARE FOOT
09
*Through 3Q 2016
10
11
12
YEAR-OVER-YEAR CHANGE
13
14
15
YEAR-OVER-YEAR CHANGE
24%
$180
PRICE PER SQUARE FOOT
Rents: 2.9%
HIGH OCCUPANCY RATES ATTRACT SFR BUYERS
TO BOSTON AS INVESTMENT SALES INCREASE
EMPLOYMENT TRENDS
METRO
Vacancy: 70 bps
• Rent: Asking rents are expected to increase 2.9 percent to
$2,537 per month in 2017.
• Investment: While both single- and multifamily vacancy rates
remain very tight, entry prices exceed $300,000, rendering
first-year returns inconsequential. Investors seeking higher
yields are eschewing this metro in favor of markets with
stronger gains.
16*
YEAR
12
CHARLOTTE
Employment: 2.5%
FINANCIAL SERVICES FIRMS EXPANDING THEIR
PRESENCE; KEEPING CONDITIONS FAVORABLE
Rents: 3.8%
EMPLOYMENT TRENDS
METRO
YEAR-OVER-YEAR CHANGE
6%
The Charlotte economy is poised to outperform the nation,
with the projected addition of 29,000 new jobs in 2017,
representing an expansion of 2.5 percent. Leading growth
sectors last year were financial services, leisure and hospitality,
and mining, logging, and construction. The financial services
sector in Charlotte continues to flourish, with two major
expansions by GoHealth, a health insurance technology
platform, and Lending Tree. GoHealth opened a new office in
the University City submarket in 2016, and will hire for a total of
600 positions by the end of 2017. Lending Tree, meanwhile, is
planning a $47 million infusion into the local economy that will
create at least 340 new jobs. While the manufacturing sector
has declined over the past year, a number of manufacturing
companies have set their sights on the Queen City, bringing at
least 1,000 new jobs to the metro area.
US
3%
0%
-3%
-6%
09
10
11
12
*Forecast
13
14
15
16
17*
YEAR
PERMITS
UNITS (000S)
12
Cash buyers continue to favor Charlotte properties, with 67
percent of SFR sales closing without leverage. However, the
volume of investment sales has dropped, relative to national
levels, as institutions have reduced activity. Institutional
investment home sales significantly decreased, presenting
individual investors with reduced competition and prime
opportunities to acquire available properties. In 2016, both
investors and traditional buyers moved into smaller properties
located in older neighborhoods due partially to a lack of
new construction and higher prices. An anticipated increase
in single-family construction in 2017 will start to reverse this
trend. While prices have climbed, cap rates remained steady
at 7.1 percent due to higher rents, making Charlotte a strong
market for investors seeking above-average returns.
SINGLE-FAMILY
MULTIFAMILY
9
6
3
0
08
09
10
11
*Annualized 3Q 2016
12
13
14
15
16*
YEAR
VACANCY & RENT
SFR RENT
VACANCY
14%
$1,250
12%
$1,100
10%
$950
8%
• Employment: Charlotte employment growth will outperform
$800
the nation this year. Employers are anticipated to add
29,000 new positions by year end, lifting payrolls 2.5
percent. In 2016, 25,000 jobs were created.
6%
09
10
11
12
13
*Forecast
Vacancy: Vacancy is projected to increase by 70 basis
points this year to 8.1 percent. Last year, vacancy ended the
year at 7.4 percent
VACANCY
MONTHLY RENT
$1,400
MARKET OUTLOOK
14
15
16
17*
YEAR
INVESTMENT HOME PRICE TRENDS
$90
• Rent: Rents are forecast to grow 3.8 percent to $1,239 per
month by the end of 2017.
• Investment: Cash investors continue to dominate this market
and capture cap rates above 7 percent, while institutional
investors have moved to other markets. Traditional buyers
could be enticed by an influx of new homes in 2017, leaving
opportunities for investors in older neighborhoods.
MEDIAN PRICE PER SQUARE FOOT
20%
YEAR-OVER-YEAR CHANGE
$80
10%
$70
0%
$60
-10%
$50
-20%
09
*Through 3Q 2016
13
10
11
12
13
YEAR
14
15
16*
YEAR-OVER-YEAR CHANGE
PRICE PER SQUARE FOOT
•
Vacancy: 70 bps
CHICAGO
Employment: 1.2%
YEAR-OVER-YEAR CHANGE
6%
US
Chicago’s economy will progress further this year as positive
employment growth in a diverse array of industries persists.
Rents are expected to increase nearly 2 percent this year,
supporting the 54,000 new jobs projected for the Windy City.
Some recent corporate expansions and relocations include
McDonald’s, Echo Global Logistics, and Beam Suntory.
McDonald’s broke ground on a new corporate HQ in the West
Loop late last year, and will bring 2,000 new jobs when its
600,000-square foot facility opens in mid-2018. Skokie-based
Echo Global Logistics will expand its Chicago operations by
adding 1,500 new employees in the coming years. Beam
Suntory, parent company of Jim Beam and Maker’s Mark plans
to move to downtown from suburban Deerfield in an effort
to diversify its workforce by the end of 2017. Strengthening
renter demand will support rent growth.
3%
0%
-3%
-6%
09
10
11
12
*Forecast
13
14
15
16
17*
YEAR
PERMITS
UNITS (000S)
12
SINGLE-FAMILY
MULTIFAMILY
9
Rising investment sales prices have prompted some investors
to pull out of the Chicago market. Total investment activity
has declined year-over-year but the percentage of all-cash
sales still eclipses national levels, indicating that investors are
searching for immediate returns over banking on appreciation.
Both traditional and investment buyers are targeting properties
higher up the quality scale, as the inventory of foreclosures
and distressed homes continues to dry up. A reduction in
the number of buyers active in the market will create new
opportunities for investors to take advantage of healthy
returns. In 2016, cap rates exceeded 7 percent, compared to
5.4 percent nationally. Rent growth should match appreciation,
keeping first-year returns relatively steady.
6
3
0
08
09
10
11
*Annualized 3Q 2016
12
13
14
15
16*
YEAR
VACANCY & RENT
SFR RENT
VACANCY
16%
$1,600
12%
$1,400
8%
$1,200
4%
$1,000
0%
09
10
11
12
13
*Forecast
14
15
16
VACANCY
MONTHLY RENT
$1,800
MARKET OUTLOOK
• Employment: Chicago employment is expected to continue
its steady growth with an expansion of 1.2 percent over
2016 levels. This year 54,000 new jobs are expected. Last
year, 48,000 new positions were added.
17*
YEAR
•
Vacancy: Single-family rental vacancy across the metro
continues to decline. This year, it is expected to settle at 5.1
percent. In 2016, levels were at 6.0 percent.
•
Rent: Rent growth in the Windy City is steady, with a
projected 1.9 percent increase of asking rents in 2017. Last
year, year-end rents were $1,586 per month.
INVESTMENT HOME PRICE TRENDS
MEDIAN PRICE PER SQUARE FOOT
24%
YEAR-OVER-YEAR CHANGE
$125
12%
$110
0%
$95
-12%
$80
YEAR-OVER-YEAR CHANGE
PRICE PER SQUARE FOOT
$140
• Investment: With strong occupancy rates and solid rent
growth, investors in Chicago are achieving cap rates of
more than 7 percent. However, with less deals available,
and a high median sale price, investors are beginning leave
the market. Those who remain are capitalizing on tenant
demand by moving up the quality scale.
-24%
09
*Through 3Q 2016
10
11
12
13
14
Rents: 1.9%
A DIVERSE ARRAY OF INVESTMENT PLAYS
ATTRACT YIELD-SEEKING BUYERS TO WINDY CITY
EMPLOYMENT TRENDS
METRO
Vacancy: 90 bps
15
16*
YEAR
14
CLEVELAND
Employment: 1.1%
CLEVELAND SINGLE-FAMILY RENTAL PROPERTIES
REMAIN HIGHEST-YIELDING IN THE NATION
Vacancy: 120 bps
Rents: 1.5%
EMPLOYMENT TRENDS
METRO
YEAR-OVER-YEAR CHANGE
6%
A latecomer to the recovery, Northeast Ohio’s economy
continues to gain momentum as it transitions from a
manufacturing-based economy to a diverse one, fueled
by education and health services, as well as the leisure
and hospitality sector. In fact, Cleveland has earned the
moniker as the nation’s medical capital in recent years. The
economy grew 1 percent in 2016, with the addition of 11,000
jobs, while in 2017 employers plan to add 12,000 positions
to the local economy, representing a five-year high. The
leisure and hospitality sector expanded 4.6 percent, driven
by a ballot measure that legalized gambling in the Buckeye
State. Ohio’s casinos generated $800 million in revenue for
schools, municipalities and counties in 2016, according to the
Ohio Casino Control Commission. Meanwhile, education and
health services expanded 3.8 percent in 2016, driven by the
Cleveland Clinic and the University Hospitals system.
US
3%
0%
-3%
-6%
09
10
11
12
*Forecast
13
14
15
16
17*
YEAR
PERMITS
UNITS (000S)
3
Low median prices for both investment properties and owneroccupied properties make Cleveland one of the top markets
for yield-seeking investors. Median investment sales prices
rose 18 percent in 2016 to $74,500, well below the national
average. As a result, cap rates remained in the double digits
last year at 10.9 percent, although below their 2015 peak
of 11.7 percent. Furthermore, only 21 percent of the housing
stock is utilized for investment purposes, which bodes well
for investors looking for new opportunities. Meanwhile,
median owner-occupied prices ended the year at 147,500. Allcash investors dominate the housing market: 70 percent of
the region’s transactions were closed by these buyers. With
elevated yields, many suburban and in-city neighborhoods
remain attractive to SFR investors seeking strong cash flow in
lieu of appreciation.
SINGLE-FAMILY
MULTIFAMILY
2
1
0
08
09
10
11
*Annualized 3Q 2016
12
13
14
15
16*
YEAR
VACANCY & RENT
SFR RENT
VACANCY
16%
$1,200
12%
$1,100
8%
$1,000
4%
MARKET OUTLOOK
$900
0%
09
• Employment: Cleveland employment is expected to inch up
VACANCY
MONTHLY RENT
$1,300
10
11
12
13
*Forecast
14
15
16
17*
YEAR
1.1 percent in 2017 as 12,000 jobs are created. Last year,
11,000 new positions were added.
INVESTMENT HOME PRICE TRENDS
• Vacancy: Vacancy for SFRs is tightening. This year, the rate
$60
PRICE PER SQUARE FOOT
• Rent: Asking rents for single-family rents are expected to
grow to $1,210 per month, up 1.5 percent from last year.
• Investment: The top-yielding market for investors, low entry
prices and rents above $1,200 characterize local investment
properties. The majority of investors use leverage to
increase their returns further. Despite strong occupancy
rates, construction remains stunted in this market, allowing
investors the opportunity to push rents higher.
20%
YEAR-OVER-YEAR CHANGE
$55
10%
$50
0%
$45
-10%
$40
-20%
09
*Through 3Q 2016
15
10
11
12
13
YEAR
14
15
16*
YEAR-OVER-YEAR CHANGE
is expected to end at 5.0 percent, down 120 basis points.
MEDIAN PRICE PER SQUARE FOOT
COLUMBIA
Employment: 1.5%
YEAR-OVER-YEAR CHANGE
4%
US
Job growth in Columbia will remain positive again this year.
Local employers plan to add 6,000 new positions in 2017,
representing growth of a 1.5 percent. A diverse economy,
fueled by the government, professional and business
services, and education and health services, will support
renter demand. The region’s manufacturing sector will
also expand in the coming years after Chinese fiberglass
manufacturer, China Jushi, opens a $300 million facility hiring
400 new employees by the end of 2018 when construction is
completed. The company announced plans to open a sister
plant nearby in 2021, hiring an additional 400 for that facility.
Within the Charlotte metro area, investors may want to focus
on properties in the Central Columbia/University and Dutch
Fork submarkets due to high occupancy levels.
3%
2%
1%
0%
10
11
12
13
*Forecast
14
15
16
17*
YEAR
PERMITS
UNITS (000S)
4
SINGLE-FAMILY
MULTIFAMILY
3
With low single-family rental vacancy and prices, Columbia
remains a strong market for all-cash SFR investors, with more
than 70 percent of the region’s buyers purchasing properties
outright. Additionally, SFR vacancies are expected to tighten
further, and drop by 260 basis points this year to a decade-low
2.3 percent. In 2016, investors began to move down the quality
scale, chasing available high-yielding inventory as prices
climbed. However, cap rates remain well above the national
average in the Columbia region, eclipsing 9 percent over
the past two years. With investment prices under $100,000,
Columbia remains a desirable market with low barriers to entry
and strong potential for future growth. Relatively low barriers
to homeownership, however, will prompt landlords to remain
conservative when raising rents, which should end the year at
$1,149 per month.
2
1
0
10
11
12
13
*Annualized 3Q 2016
14
15
16
YEAR
VACANCY & RENT
SFR RENT
VACANCY
16%
$900
12%
$600
8%
$300
4%
$0
0%
10
11
12
13
*Forecast
14
15
16
VACANCY
MONTHLY RENT
$,1200
MARKET OUTLOOK
• Employment: After adding 6,500 jobs in 2016, employment
growth has slowed slightly in Columbia. In 2017, 6,000 new
positions are forecast, representing a 1.5 percent growth for
the year.
17*
YEAR
• Vacancy: SFR vacancy is projected to drop by 260 basis
INVESTMENT HOME PRICE TRENDS
MEDIAN PRICE PER SQUARE FOOT
YEAR-OVER-YEAR CHANGE
$60
12%
$50
0%
$40
-12%
$30
-24%
10
*Through 3Q 2016
11
12
13
14
15
points this year. In 2017, levels are expected to come in at
2.3 percent at year’s end. In 2016, they ended the year at
4.8 percent.
24%
YEAR-OVER-YEAR CHANGE
PRICE PER SQUARE FOOT
$70
Rents: 1.6%
LOW VACANCY AND HIGH CAP RATES ATTRACT
CASH BUYERS TO SMALL COLUMBIA MARKET
EMPLOYMENT TRENDS
METRO
Vacancy: 260 bps
• Rent: Rents are anticipated to grow to $1,150 per month in
2017, up 1.6 percent from year-end last year.
• Investment: Though Columbia has lower vacancy than the
national average and cap rates above 9 percent, investors
are seeking markets with stronger job growth and less
competition from traditional buyers.
16
YEAR
16
DALLAS/FORT WORTH
Employment: 2.9%
METROPLEX ECONOMIC ENGINE WILL
CREATE MOST NEW JOBS IN NATION
Vacancy: 30 bps
Rents: 3.5%
EMPLOYMENT TRENDS
METRO
YEAR-OVER-YEAR CHANGE
6%
A nearly 3 percent increase in jobs in 2017 is expected for
Dallas/Fort Worth as 105,000 new positions are created.
Texas’ largest market should post positive employment
growth across most sectors. Education and health services
will be a significant contributor to growth. For example,
Longview-based Everest Rehabilitation Hospital and the Plaza
Medical Center in Fort Worth are expanding. The latter is in
the midst of a $64 million expansion to its trauma services
center, which will ultimately create an additional 130 positions,
while the former will add another 120 jobs after the $10 million
expansion concludes. Other firms adding to payrolls include
GM Financial, which will add 1,300 jobs to Dallas/Fort Worth
between now and the end of the year, and AT&T, which is
investing in an urban live-work-play district that is expected to
employ at least 1,200 residents.
US
3%
0%
-3%
-6%
09
10
11
12
*Forecast
13
14
15
16
17*
YEAR
PERMITS
25
SINGLE-FAMILY
MULTIFAMILY
UNITS (000S)
20
As the foreclosure stock continues to dry up, institutional
investors are beginning to leave Dallas/Fort Worth. Sale prices
for both investment and traditional homes are up, though
investors are moving up the quality scale with leverage, while
traditional buyers are moving down. Both traditional and
investment buyers are purchasing assets with a higher costper-square-foot over the previous year, yet have a smaller
footprint. Single-family permits are up while multifamily
property permits are down as builders pause to enable the
market to absorb the influx of new units that have come
online. Cap rates in Dallas/Fort Worth have compressed 30
basis points to the mid-6 percent range. Additional downward
pressure could be applied to cap rates, though significant
movement is unanticipated due to higher interest rates.
15
10
5
0
08
09
10
11
*Annualized 3Q 2016
12
13
14
15
16*
YEAR
VACANCY & RENT
SFR RENT
MARKET OUTLOOK
VACANCY
16%
$1,350
12%
$900
8%
$450
4%
VACANCY
MONTHLY RENT
$1,800
• Employment: The Metroplex is expected to add 105,000
$0
new jobs in 2017, representing a growth of 2.9 percent. In
2016, employers added 106,000 positions.
0%
09
10
11
12
13
*Forecast
15
16
17*
YEAR
• Vacancy: In 2017, vacancy at SFRs is expected to drop to 30
basis points to 6.7 percent.
INVESTMENT HOME PRICE TRENDS
PRICE PER SQUARE FOOT
$120
percent to $1,662 per month this year.
Investment: Unlike many investment markets, investors
in Dallas are moving up the quality scale, while traditional
buyers are moving in the opposite direction. With strong
price growth, first-time buyers are being priced out of the
market, though stable job gains will keep those would-be
homeowners renting in similar neighborhoods. With cap
rates above 6 percent and strong fundamentals, investors
should reap short- and long-term gains.
MEDIAN PRICE PER SQUARE FOOT
16%
YEAR-OVER-YEAR CHANGE
$100
8%
$80
0%
$60
-8%
$40
-16%
09
*Through 3Q 2016
17
10
11
12
13
YEAR
14
15
16*
YEAR-OVER-YEAR CHANGE
• Rent: Asking rents for Dallas SFRs are expected to rise 3.5
•
14
DENVER
Employment: 3.3%
YEAR-OVER-YEAR CHANGE
6%
US
3%
The robust rent growth enjoyed by Denver landlords over
the past few years appears to have flattened. As apartment
developers bring thousands of units online this year, SFR
operators will limit rent hikes to compete for tenants. Absorption
will remain healthy as Denver’s economic expansion creates
a projected 48,000 additional positions this year. In fact, job
growth in Denver will outstrip the level projected for the U.S.
economy in 2017. Many of the region’s jobs will come in the
trade, transportation and utilities; professional and business
services; and government sectors of the economy. For
example, at the end of 2016, BP announced plans to shift its
focus to Denver, and will be moving their Lower-48 business
headquarters from Houston, hiring 200 new employees. This
move marks a shift away from a single U.S. energy hub, with
the potential for more energy sector companies moving to the
Rocky Mountain region in the coming years.
0%
-3%
-6%
09
10
11
12
*Forecast
13
14
15
16
17*
YEAR
PERMITS
10
SINGLE-FAMILY
MULTIFAMILY
UNITS (000S)
8
6
4
As an investment market, Denver remains less popular than
other similar-sized markets and the presence of investors
continues to decline due to elevated prices. Despite this
slowdown, the number of cash investment sales has increased
slightly in the past year, and the value of investment properties
continues to rise. Investors are forced to bring higher down
payments to the table to bring cash flow up to levels where
the properties are self sustaining. Traditional homebuyers in
the Mile High City, meanwhile, are moving into higher-quality
neighborhoods. Rents have grown since last year, though the
pace of growth has failed to keep pace with appreciation.
Combined with persistently low cap rates, yield-seeking
investors will consider properties in other metro areas.
2
0
08
09
10
11
*Annualized 3Q 2016
12
13
14
15
16*
YEAR
VACANCY & RENT
SFR RENT
VACANCY
10%
$1,650
8%
$1,100
6%
$550
4%
$0
2%
VACANCY
MONTHLY RENT
$2,200
Rents: 1.6%
SFR INVESTORS REDUCING PRESENCE IN THE
DENVER MARKET AS RENTS BEGIN TO PLATEAU;
CAP RATES REMAIN COMPRESSED
EMPLOYMENT TRENDS
METRO
Vacancy: 30 bps
MARKET OUTLOOK
08
09
10
11
12
*Forecast
13
14
15
16
• Employment: Payroll gains are anticipated to outperform
17*
national levels as payrolls expand 3.3 percent. In 2017,
48,000 new jobs are forecast. Last year, the metro also
added 48,000 positions.
YEAR
INVESTMENT HOME PRICE TRENDS
• Vacancy: After a 20-basis point rise in 2016, vacancy at
$200
16%
single-family rentals is expected to dip 30 basis points to
4.4 percent in 2017.
$150
8%
$100
0%
$50
-8%
PRICE PER SQUARE FOOT
MEDIAN PRICE PER SQUARE FOOT
09
*Through 3Q 2016
10
11
12
YEAR-OVER-YEAR CHANGE
13
14
15
YEAR-OVER-YEAR CHANGE
24%
$250
• Rent: Single-family rents in this market are expected to inch
up to $2,097 per month, a 1.6 percent increase over 2016.
• Investment: Though this market has job growth that exceeds
national levels, investment prices are well over $300,000
and cap rates linger just above 4 percent, encouraging
investors to seek higher yields elsewhere.
16*
YEAR
18
DETROIT
Employment: 2.1%
RECORD AUTO SALES SUPPORTING
RESURGENCE IN DETROIT’S ECONOMY
Vacancy: 150 bps
Rents: 2.7%
EMPLOYMENT TRENDS
METRO
YEAR-OVER-YEAR CHANGE
8%
A renaissance in Downtown Detroit will continue to bolster
the local economy in 2017. Last year, metro employers added
13,000 new positions, representing growth of 1.8 percent but
this year, the economy will grow 2.1 percent as 16,000 new
positions are created. The manufacturing sector, fueled by
the automotive industry, continues to support the recovery,
along with strong assists from other employment sectors. The
leisure and hospitality sector leads the economic expansion,
followed by the professional and business services sector.
To cater to millennials and educated middle-class workers,
developers were expected to bring between 1,200 and 1,400
multifamily units online in the heart of downtown last year.
In addition, single-family permitting increased to meet the
growing demand among renters. For the first time in a decade,
Detroit vacancy will dip below 5 percent in 2017, making it a
tight market by national standards. Rent growth remained in
the 4.0 to 4.5 percent range over the past two years, but will
slow to 2.7 percent by year’s end.
US
4%
0%
-4%
-8%
09
10
11
12
*Forecast
13
14
15
16
17*
YEAR
PERMITS
UNITS (000S)
8
SINGLE-FAMILY
MULTIFAMILY
6
4
2
Investors have fueled the local housing market over the past
five years, creating a lack of for-sale inventory in the Detroit
area. Single-family rental sales account for a significant share
of transactions in the market. As a result, owner-occupied
median home price and investment prices are virtually in lock
step. If buyers can find and procure single-family rentals in
this market, they will benefit from low entry prices, relative to
major coastal markets. The median investment home price
increased to $155,000 last year. Although cap rates declined
70 basis points year-over-year since 2015, they remain high at
6.7 percent, presenting excellent upside potential for investors.
SFR investors in search of solid yields and strong renter
demand should capitalize on rapidly improving downtown
submarkets such as Midtown, East Riverfront and Corktown.
0
08
09
10
11
*Annualized 3Q 2016
12
13
14
15
16*
YEAR
VACANCY & RENT
SFR RENT
VACANCY
18%
$1,100
14%
$1,000
10%
$900
6%
$800
2%
09
MARKET OUTLOOK
10
11
12
13
*Forecast
• Employment: Auto manufacturers will help create 16,000
VACANCY
MONTHLY RENT
$1,200
14
15
16
17*
YEAR
jobs this year, lifting payrolls 2.1 percent.
INVESTMENT HOME PRICE TRENDS
• Vacancy: Low construction levels should support a forecast
$120
PRICE PER SQUARE FOOT
• Rent: Average rents are projected to rise 2.7 percent in 2017
to $1,113 per month.
• Investment: After announcing billions in U.S. investments,
the auto industry is expected to whet the appetite of
investors in the Motor City.
21%
YEAR-OVER-YEAR CHANGE
$90
14%
$60
7%
$30
0%
$0
-7%
09
*Through 3Q 2016
19
10
11
12
13
YEAR
14
15
16*
YEAR-OVER-YEAR CHANGE
150 basis point decrease in vacancy to 4.3 percent.
MEDIAN PRICE PER SQUARE FOOT
HOUSTON
Employment: 1.3%
METRO
YEAR-OVER-YEAR CHANGE
US
3%
While year-over-year growth does not outpace national
levels, the Houston employment sector is recovering, with
the addition of 40,000 jobs, or 1.3 percent growth forecast for
2017. Employment dropped over the last few years due to the
instability of the energy sector, but it is expected to resume
an upward trajectory this year. Phillips 66 moved into its new
1.1 million-square-foot headquarters located off Beltway 8 in
Westchase. The Fortune 500 company took up occupancy of
two Class A office towers in mid-2016. Trade, transportation
and utilities, as well as professional and business services
are two other major employment sectors, with the former
exhibiting a continued expansion. Vacancy will decline 130
basis points to 7.3 percent, a decade-low number for the
metro, although rents will slide downward slightly as renters
continue to absorb high levels of new construction from 2016.
0%
-3%
-6%
09
10
11
12
*Forecast
13
14
15
16
17*
YEAR
PERMITS
UNITS (000S)
40
SINGLE-FAMILY
MULTIFAMILY
30
20
10
0
08
09
10
11
*Annualized 3Q 2016
12
13
14
15
16*
YEAR
VACANCY & RENT
SFR RENT
VACANCY
20%
$1,200
16%
$800
12%
$400
8%
$0
VACANCY
MONTHLY RENT
$1,600
4%
08
09
10
11
12
*Forecast
13
14
15
16
17*
In recent years, investors in the Houston market have
moved down the quality scale, a trend echoed by traditional
homebuyers in the market. As the local economy recovers
from the energy sector-inflicted dip, it is likely that this trend will
reverse, especially as new properties come online. Although
cap rates have trended downwards, they remain higher
than the national average, presenting out-of-state investors
with opportunities to acquire properties with solid returns.
Cap rates fell 40 basis points to 6.9 percent in 2016 as the
median investment home price appreciated to $162,900. With
the prospect of economic recovery on the horizon and less
competition among buyers for investment housing, Houston
remains a strong market for long-term growth. Investors
banking on this long-term growth may want to target suburban
locations such as Spring Branch and Katy, which will offer solid
long-term appreciation.
MARKET OUTLOOK
YEAR
• Employment: Last year, the Houston metro added 9,000
new positions. This year, 40,000 jobs are projected,
representing a 1.3 percent growth over last year.
INVESTMENT HOME PRICE TRENDS
MEDIAN PRICE PER SQUARE FOOT
16%
YEAR-OVER-YEAR CHANGE
$80
8%
$60
0%
$40
-8%
$20
-16%
09
*Through 3Q 2016
10
11
12
13
14
15
YEAR-OVER-YEAR CHANGE
PRICE PER SQUARE FOOT
$100
Rents: -0.4%
LONG-TERM PROSPECTS FOR INVESTMENT
HOUSING GROWTH REMAIN STRONG IN THE
HOUSTON MARKET
EMPLOYMENT TRENDS
6%
Vacancy: 130 bps
• Vacancy: Vacancy in Houston is expected to drop to 7.3
percent, down 130 basis points from 2016.
• Rent: Rents are anticipated to decline slightly this year. Yearend rents in 2017 are expected to be $1,591 per month. Last
year, rents were $1,598 per month at the end of the year.
•
16*
YEAR
20
Investment: Though Houston’s vacancy remains higher
than other Texas markets, cap rates exceed national levels.
As the economy recovers from the energy-sector downturn,
it is likely investors will return to this strong-yield market.
INDIANAPOLIS
Employment: 0.9%
INDIANAPOLIS INVESTMENT MARKET EXPECTED
TO IMPROVE THIS YEAR AS HEALTHCARE FUELS
MODEST JOB GROWTH
Vacancy: 70 bps
Rents: 2.0%
EMPLOYMENT TRENDS
METRO
YEAR-OVER-YEAR CHANGE
6%
In 2017, the employment market in Indianapolis is expected
to gain 9,000 jobs, a nearly 1 percent gain from last year.
While solid, this represents a slight slowing of growth in this
metro, as approximately 14,200 jobs were created in 2016.
Nonetheless, trade transportation and utilities, education
and health services, and government continue to make up
the largest sectors in the local economy. Among the notable
expansions in the healthcare space, TriMedX, a healthcare
technology company, is planning on adding 100 new jobs
to the region in the coming years following a $21.5 million
expansion. Meanwhile, Cook Group Inc., a Bloomington-based
medical research firm which will infuse $16.5 million into its
business and hire 82 high-paying jobs in the next five years.
Other expansions include Pittsburgh-based GetGo Café +
Market adding 150 jobs in the metro; and student loan officer,
Sallie Mae, who will add nearly 300 jobs to the region by 2018.
US
3%
0%
-3%
-6%
09
10
11
12
*Forecast
13
14
15
16
17*
YEAR
PERMITS
UNITS (000S)
8
The overall volume of investment sales is down as investors
are being pushed farther out into the suburbs to capture the
same high cap rates. At the same time, entry prices are below
$100,000 and investors are split evenly between cash and
leveraged transactions. With declining vacancy rates marketwide, healthy rent growth, and cap rates at nearly 8 percent,
Indianapolis presents an opportunity for investors with long
investment horizons. A relatively modest pace of appreciation
favors investors seeking monthly dividends in the form of rents
rather than briskly growing valuations. Reacting to growing
demand for single-family properties, builders have pulled an
increased number of single-family permits over the last four
years. Nonetheless, renter demand has remained sufficient to
pull vacancy lower, benefiting local investors.
SINGLE-FAMILY
MULTIFAMILY
6
4
2
0
08
09
10
11
*Annualized 3Q 2016
12
13
14
15
16*
YEAR
VACANCY & RENT
SFR RENT
VACANCY
16%
$1,100
12%
$1,000
8%
$900
4%
MARKET OUTLOOK
$800
0%
09
• Employment: Job growth in Indianapolis has slowed since
VACANCY
MONTHLY RENT
$1,200
10
11
12
13
*Forecast
14
15
16
17*
YEAR
2016 when 14,200 new positions were added to the region.
By year-end, it is expected that an additional 9,000 new
openings will be created, representing a 0.9 percent growth.
INVESTMENT HOME PRICE TRENDS
$80
PRICE PER SQUARE FOOT
down 70 basis points from 2016.
• Rent: Rent growth is forecast at 2.0 percent, leaving yearend asking rents at $1,183 per month.
• Investment: Strong rent growth and declining vacancy rates,
combined with low entry prices and cap rates at nearly 8
percent will draw in investors looking for long-term gains.
24%
YEAR-OVER-YEAR CHANGE
$70
16%
$60
8%
$50
0%
$40
-8%
09
*Through 3Q 2016
21
10
11
12
13
YEAR
14
15
16*
YEAR-OVER-YEAR CHANGE
• Vacancy: SFR vacancy is forecast to end 2017 at 6.9 percent,
MEDIAN PRICE PER SQUARE FOOT
INLAND EMPIRE
Employment: 1.8%
YEAR-OVER-YEAR CHANGE
6%
US
3%
A diverse economy continues to bolster the Riverside-San
Bernardino rental market. In 2016, employers added 23,000
jobs, marking growth of nearly 1.5 percent. Continued
expansion will occur across many sectors of the Inland
Empire economy in 2017, supporting the addition of 25,000
jobs. A federal training program called TechHire, designed to
bring more STEM jobs to the region, now includes Riverside.
TechHire has committed 4,000 people to technology jobs over
the next five years in such industries such as data analytics,
healthcare IT, cyber-security and robotics. The warehouse
sector continues to improve, highlighted by a spate of recent
real estate projects and leases. Builders brought nearly 10
million square feet of warehouse space online during the
second quarter of 2016. Amazon, QVC and UPS are among
the firms that have commenced build-to-suit projects or inked
major leases for warehouse or distribution space in the region.
0%
-3%
-6%
09
10
11
12
*Forecast
13
14
15
16
17*
YEAR
PERMITS
10
SINGLE-FAMILY
MULTIFAMILY
UNITS (000S)
8
6
4
With low investment home prices and high cap rates relative
to other major California metros, the Riverside-San Bernardino
area remains one of the most attractive in the state for SFR
investing. In fact, investment home price growth skyrocketed
10.8 percent in 2016, reaching $277,000, and cap rates
remained steady for the past three years, moving only 10
basis points to 4.5 percent in 2016. An increase in multifamily
construction will assist in moderating rents for both SFRs and
apartments. Rent growth in the Inland Empire soared over the
past three years – growing 8.6 percent in 2016 – but will drop
down to more normalized levels in 2017.
2
0
08
09
10
11
*Annualized 3Q 2016
12
13
14
15
16*
YEAR
VACANCY & RENT
SFR RENT
VACANCY
12%
$1,350
10%
$900
8%
$450
6%
• Employment: This year, 25,000 jobs are projected to be
$0
4%
added, a gain of 1.8 percent. Last year, 23,000 new positions
were created.
09
10
11
12
13
*Forecast
14
15
16
VACANCY
MONTHLY RENT
$1,800
Rents: 2.3%
STRONG ECONOMIC GROWTH GENERATES
RENTER DEMAND; COMPARATIVELY LOW ENTRY
PRICES DRAW COASTAL INVESTORS
EMPLOYMENT TRENDS
METRO
Vacancy: 70 bps
MARKET OUTLOOK
17*
• Vacancy: Vacancy for single-family rentals is anticipated to
YEAR
tighten by 70 basis points to 5.3 percent this year.
• Rent: A 2.3 percent year-over-year gain in rents is expected
INVESTMENT HOME PRICE TRENDS
MEDIAN PRICE PER SQUARE FOOT
in the Inland Empire. Average rents are anticipated to close
at $1,768 per month.
24%
YEAR-OVER-YEAR CHANGE
$150
18%
$100
12%
$50
6%
$0
YEAR-OVER-YEAR CHANGE
PRICE PER SQUARE FOOT
$200
• Investment: The Inland Empire remains one of the most
affordable investment markets in California, drawing
investors from Orange and Los Angeles counties that prefer
to manage their own assets. As prices climb and yields
remain relatively low, some of those investors will transition
to out-of-state acquisitions.
0%
09
*Through 3Q 2016
10
11
12
13
14
15
16*
YEAR
22
JACKSONVILLE
Employment: 3.4%
EMERGING JACKSONVILLE RENTAL MARKET
PRESENTS SOUND INVESTMENT OPPORTUNITIES
Rents: 2.0%
EMPLOYMENT TRENDS
METRO
YEAR-OVER-YEAR CHANGE
6%
The Jacksonville employment market will outpace average
growth both nationally and across Florida. This year, 23,000
new jobs are projected, representing a 3.4 percent gain
annually. Major sectors contributing the region’s economic
strength include trade, transportation and utilities, business
and professional services, and leisure and hospitality. Amazon,
for example, announced plans to develop distribution and
fulfillment centers that will create 2,700 jobs upon opening
in late 2017. Human Resources software company Randrr is
another presence expanding to Jacksonville. The startup
will invest $9 million to create 200 skilled positions over
the next two years, paying an average salary of $200,000.
Median single-family rents are projected to grow 2 percent
over last year, while permits for single-family properties will
also increase to meet demand. Multifamily permit issuance
has declined due to elevated levels of existing supply and an
increase in vacancy.
US
3%
0%
-3%
-6%
09
10
11
12
*Forecast
13
14
15
16
17*
YEAR
PERMITS
8
SINGLE-FAMILY
MULTIFAMILY
6
UNITS (000S)
Overall sales volume for both traditional and investment sales
are down in Jacksonville, likely due to higher prices and a
smaller stock of distressed properties. On the investment
side, prices for both cash and leveraged investment sales
have increased. Nonetheless, the percentage of investment
sales in this market continue to outpace national levels while
favoring smaller retail investors, as institutional buyers take a
back seat. In recent months, investors have started to move
up the quality scale into newer neighborhoods with assets
that have a larger footprint and price-per-square foot. With an
uptick in single-family construction, investors may need to be
cautious of competing with the for-sale market.
4
2
0
08
09
10
11
*Annualized 3Q 2016
12
13
14
15
16*
YEAR
VACANCY & RENT
SFR RENT
Employment: Employers in Jacksonville are hiring at a
robust pace, creating 23,000 positions, representing a 3.4
percent gain. Last year, 25,000 jobs were created.
VACANCY
20%
$1,050
16%
$700
12%
$350
8%
$0
VACANCY
MONTHLY RENT
$,1400
MARKET OUTLOOK
•
Vacancy: 90 bps
4%
09
10
11
12
13
*Forecast
14
15
16
17*
YEAR
• Vacancy: Single-family operators should expect vacancy
levels to decline 90 basis points this year to 7.2 percent.
INVESTMENT HOME PRICE TRENDS
PRICE PER SQUARE FOOT
$100
$1,341, up 2.0 percent from the end of 2016. Last year,
average rents jumped 4.2 percent.
•
Investment: Above-average job growth and a steady
increase in marketwide rents are drawing investors to this
Florida market. With vacancy rates projected to decline,
and entry prices well below the national average, investors
seeking solid first-year returns are increasing their presence
in Jacksonville.
MEDIAN PRICE PER SQUARE FOOT
24%
YEAR-OVER-YEAR CHANGE
$80
16%
$60
8%
$40
0%
$20
-8%
09
*Through 3Q 2016
23
10
11
12
13
YEAR
14
15
16*
YEAR-OVER-YEAR CHANGE
• Rent: Marketwide rents are expected to end the year at
LAS VEGAS
Employment: 2.7%
YEAR-OVER-YEAR CHANGE
8%
US
With an economy driven primarily by tourism, the Las Vegas
metro tends to have an above-average presence of renters.
The seasonal nature of employment in this sector often delays
homeownership, creating rental demand, and making it a
perennial favorite of both retail and institutional single-family
rental investors alike. Current single-family rental vacancy rates
for the market are relatively tight, though apartment vacancy
is high, and may tick up with the increase in new inventory
coming online. Nonetheless, a projected 25,000 jobs are
expected to be added in 2017, up slightly from 2016 levels.
These positions and a resurgent gaming industry will support
renter demand. Landlords can capitalize on above-average
demand by focusing on the South Las Vegas submarket.
4%
0%
-4%
-8%
09
10
11
12
*Forecast
13
14
15
16
17*
YEAR
PERMITS
UNITS (000S)
12
SINGLE-FAMILY
MULTIFAMILY
Since the last housing boom, Las Vegas has consistently
had a stronger-than-average investor presence. Typically,
lower priced homes, with a tight vacancy and the prospect of
appreciation have drawn single-family landlords to the metro.
However, over the past five years, volume of investor activity
has slowly begun to decline, as the deals that originally lured
many to the market dry up, and appreciation rates return to
long-term levels. Cash investments in this market are also on
the decline, though still outstrip national levels. While 2014 and
2015 witnessed investors moving into older neighborhoods,
in 2016 investors began moving back up the quality scale,
into larger properties in newer neighborhoods. Cap rates in
this market remain near 5 percent. Institutional investors are
beginning to cool on the market, as the available bulk supply
deals have dried up.
9
6
3
0
08
09
10
11
*Annualized 3Q 2016
12
13
14
15
16*
YEAR
VACANCY & RENT
SFR RENT
VACANCY
15%
$1,200
12%
$800
9%
$400
6%
$0
VACANCY
MONTHLY RENT
$1,600
MARKET OUTLOOK
• Employment: Though late to the recovery, Las Vegas is
expected to add 25,000 new positions to the economy this
year. Last year, 20,000 jobs were created.
3%
09
10
11
12
13
*Forecast
14
15
16
17*
• Vacancy: Job growth should contribute to a decline in the
YEAR
vacancy rate. By the end of the year, levels are expected
to drop to 4.6 percent, down 150 basis points for the year.
INVESTMENT HOME PRICE TRENDS
MEDIAN PRICE PER SQUARE FOOT
• Rent: Operators in Las Vegas are expected to grow average
30%
YEAR-OVER-YEAR CHANGE
$100
15%
YEAR-OVER-YEAR CHANGE
PRICE PER SQUARE FOOT
$120
$80
0%
$60
-15%
$40
rents to $1,410 per month 2017, up 3.1 percent from 2016.
• Investment: Investment volume in Las Vegas was strong
during the recovery, however investors are beginning to
move away from this market as inventory levels decline and
distressed deals are difficult to find. Those who remain in
this market are focused on the South Las Vegas submarket
where vacancy levels are especially low.
-30%
09
*Through 3Q 2016
10
11
12
Rents: 3.1%
HEALTHY GAMING INDUSTRY SUPPORTING
NEW RENTER DEMAND IN LAS VEGAS
EMPLOYMENT TRENDS
METRO
Vacancy: 150 bps
13
14
15
16*
YEAR
24
LOS ANGELES
Employment: 2.1%
BOOMING ECONOMY, HOUSING MARKET SUPPORT
APPRECIATION OPPORTUNITIES IN L.A.
Rents: 3.8%
EMPLOYMENT TRENDS
METRO
YEAR-OVER-YEAR CHANGE
6%
Employment conditions in L.A. County remain among the
strongest in the state. Job growth will expand 2.1 percent in
2017, with the addition of 90,000 new jobs. The largest sector
– trade, transportation and utilities – will keep growing this
year to bolster the Port of Long Beach’s labor requirements
and other infrastructure projects. Phase one of the $1.3
billion Middle Harbor Terminal wrapped up in late 2015. Upon
completion in 2019, the port will be redeveloped into the
greenest, most technologically advanced container terminal
in the world. Another major project rising in L.A. is the Los
Angeles Stadium and Entertainment District at Hollywood Park
in Inglewood. In 2019, the stadium will house the L.A. Rams
and L.A. Chargers, and give the city greater leverage in its bid
for the 2024 Olympics. L.A. rent growth soared 6.6 percent
year-over-year in 2016 to $2,550 per month, and will continue
to grow in 2017, although not as frenetically. Vacancies will
tighten 10 basis points in 2017 to a decade-low 2.9 percent.
US
3%
0%
-3%
-6%
09
10
11
12
*Forecast
13
14
15
16
17*
YEAR
PERMITS
UNITS (000S)
20
As L.A.’s housing market remains heated, median SFR prices
edged closer to owner-occupied home prices: SFRs traded for
$530,000 in 2016, while owner-occupied assets commanded
$560,000. Investment home cap rates, meanwhile, continued
their downward trajectory, dropping 30 basis points from
2015 to 3.5 percent, limiting Los Angeles a market for
investors seeking appreciation. Since the number of retail
and institutional buyers dropped on an annual basis in 2016,
this year could signal an opportune time to enter the market.
In addition to Inglewood, investors should target the West
Adams and Jefferson Park neighborhoods, also located in
south central L.A., for SFR yields. Meanwhile, Highland Park,
Glassel Park, and Montecito Heights in northeast L.A. provide
investors with solid opportunities for appreciation.
SINGLE-FAMILY
MULTIFAMILY
15
10
5
0
08
09
10
11
*Annualized 3Q 2016
12
13
14
15
16*
YEAR
VACANCY & RENT
SFR RENT
$3,000
VACANCY
8%
6%
$2,000
4%
$1,500
2%
MONTHLY RENT
$2,500
$1,000
0%
09
Employment: Employment growth is robust. This year,
90,000 positions are expected, a 2.1 percent increase.
VACANCY
MARKET OUTLOOK
•
Vacancy: 10 bps
10
11
12
13
*Forecast
14
15
16
17*
YEAR
• Vacancy: One of the tightest markets in the country, Los
INVESTMENT HOME PRICE TRENDS
PRICE PER SQUARE FOOT
$400
• Rent: Single-family home rents in the Los Angeles metro are
expected to grow to $2,644 per month. This represents a
3.8 percent year-over-year increase from 2016 rents.
• Investment: The Los Angeles economy is booming, however
investment levels remain low, due to high entry costs. This
market does provide strong projected growth through
appreciation, and appeals to investors who are willing to
take a hit now for long-term gains.
MEDIAN PRICE PER SQUARE FOOT
30%
YEAR-OVER-YEAR CHANGE
$300
20%
$200
10%
$100
0%
$0
-10%
09
*Through 3Q 2016
25
10
11
12
13
YEAR
14
15
16*
YEAR-OVER-YEAR CHANGE
Angeles vacancy is anticipated to drop to 2.9 percent,
down 10 basis points from last year.
MEMPHIS
Employment: 1.3%
YEAR-OVER-YEAR CHANGE
6%
US
Memphis employment growth will remain steady, with 8,000
new jobs expected 2017. The region is becoming a hub for
medical device manufacturers. The Greater Memphis Alliance
for a Competitive Workforce is working towards that aim, with
a goal of filling over 800 high-paying jobs. Another notable
expansion includes the multifamily management company
MAA, which is moving its headquarters to the Germantown
submarket, where it will create more than 200 jobs with
average salaries of $85,000. Rents are continuing on their
upward trajectory, while builders have pulled back on permits
for single-family homes until the existing stock is absorbed.
Multifamily permits have grown, however it will be some time
before these properties come online to provide competition
for existing single-family rentals.
3%
0%
-3%
-6%
09
10
11
12
*Forecast
13
14
15
16
17*
YEAR
PERMITS
UNITS (000S)
4
SINGLE-FAMILY
MULTIFAMILY
3
The Memphis investment market attracts cash-heavy buyers
at low price points. Average cap rates in Memphis are slightly
below 9 percent, well above the national rate. Furthermore,
higher-end investments can still be found for first-year returns
near 6 percent. Although most buyers are chasing yields in
the Memphis metro, some investors will consider the relatively
safety of nicer homes. This is supported by a decline in cash
investment sales in this market. Overall, home prices in
Memphis continue to grow, which could begin to price some
first-time buyers out of the market. An increase in interest rates
will also apply pressure to homeownership rates and push
vacancy lower this year. Meanwhile, permitting has leveled off,
which will limit the supply-side pressure facing SFR operators.
2
1
0
08
09
10
11
*Annualized 3Q 2016
12
13
14
15
16*
YEAR
VACANCY & RENT
SFR RENT
VACANCY
25%
$900
20%
$600
15%
$300
10%
$0
VACANCY
MONTHLY RENT
$1,200
MARKET OUTLOOK
• Employment: Job growth is inching higher in Memphis. In
2017, employers are expected to create 8,000 jobs, a 1.3
percent year-over-year gain. Last year, 5,000 new positions
were added to the economy.
5%
09
10
11
12
13
*Forecast
14
15
16
17*
• Vacancy: Memphis vacancy levels are projected to drop
YEAR
by nearly 300 basis points from last year’s 8.4 percent as
household formation far outstrips new construction.
INVESTMENT HOME PRICE TRENDS
MEDIAN PRICE PER SQUARE FOOT
• Rent: Asking rents are projected to grow 1.8 percent to
10%
YEAR-OVER-YEAR CHANGE
$55
5%
$50
0%
$45
-5%
$40
YEAR-OVER-YEAR CHANGE
PRICE PER SQUARE FOOT
$60
$1,058 per month this year. In 2016, the year ended with
rents at $1,040 per month.
• Investment: High yields and low entry prices will attract outof-state investors to Memphis in 2017. As prices elsewhere
mean fewer single-family deals pencil out, more investors
will consider this market in the coming months.
-10%
09
*Through 3Q 2016
10
11
12
Rents: 1.8%
INVESTMENT OPPORTUNITIES ABOUND FOR
BUYERS AS MEMPHIS JOB CONDITIONS IMPROVE
EMPLOYMENT TRENDS
METRO
Vacancy: 300 bps
13
14
15
16*
YEAR
26
MIAMI
Employment: 1.9%
SOARING HOME PRICES DRIVE
RENTAL DEMAND IN MIAMI-DADE
Vacancy: 20 bps
Rents: 2.0%
EMPLOYMENT TRENDS
METRO
YEAR-OVER-YEAR CHANGE
6%
As South Florida’s high-priced housing market starts to cool,
demand for single-family and multifamily rentals will remain
strong, fueled by positively trending economic growth. Even
though developers brought a glut of new condo projects
online over the past two years, home prices remain out of
reach for many buyers. As the luxury condo sector feels the
impacts of oversupply, both monthly multifamily and singlefamily rents will rise, while vacancies are on track to decline.
Last year, builders issued a total of 9,200 residential permits.
Miami’s payrolls are expected to expand 1.9 percent in 2017.
Last year, regional employers added 19,600 positions to the
metro, with the greatest growth in the leisure and hospitality,
and professional and business services sectors. Financial
services giant Wells Fargo signed the biggest lease in Miami
last year: a $32 million relocation and expansion at Wells
Fargo Center, a Class A office tower located downtown.
US
3%
0%
-3%
-6%
09
10
11
12
*Forecast
13
14
15
16
17*
YEAR
PERMITS
12
MULTIFAMILY
9
UNITS (000S)
International buyers primarily located in Latin America have
historically fueled investment home-buying activity in MiamiDade, although 2016 saw an exception to that trend as the
value of the U.S. dollar eclipsed other currencies. Overall
investment activity in the local housing market declined by
approximately 50 percent year-over-year in 2016s. In spite
of this downturn, SFR cap rates declined 80 basis points to
6.8 percent last year as investment home prices increased. At
the same time, strong growth occurred in the owner-occupied
segment of the housing market, as median prices rose 12
percent to $307,500. While challenging for both international
and local investors, out-of-state buyers from such locales as
the Bay Area or New York City may target acquisitions that
offer both healthy yields and modest appreciation relative
to coastal housing markets. Furthermore, competition for
investment housing will decline as institutional buyers
continue their exodus from the region, giving retail investors
the upper hand in Miami.
SINGLE-FAMILY
6
3
0
08
09
10
11
*Annualized 3Q 2016
12
13
14
15
16*
YEAR
VACANCY & RENT
SFR RENT
VACANCY
20%
$2,100
15%
$1,800
10%
$1,500
5%
$1,200
VACANCY
MONTHLY RENT
$2,400
0%
09
10
11
12
13
*Forecast
14
15
16
17*
YEAR
MARKET OUTLOOK
• Employment: Employers in Miami are expected to increase
INVESTMENT HOME PRICE TRENDS
$160
PRICE PER SQUARE FOOT
• Vacancy: Vacancy levels are projected to drop 20 basis
points to 6.5 percent.
• Rent: Asking rents are projected to increase to $2,238 per
month this year. This is a 2 percent rise annually.
•
Investment: Investors from the Northeast may consider
SFRs in Miami that could serve as a future retirement home.
Latin American investors, meanwhile, many consider the
safety of Miami assets amidst economic turmoil elsewhere.
24%
YEAR-OVER-YEAR CHANGE
$120
12%
$80
0%
$40
-12%
$0
-24%
09
*Through 3Q 2016
27
10
11
12
13
YEAR
14
15
16*
YEAR-OVER-YEAR CHANGE
employment in the metro by 1.9 percent, or 22,000 jobs.
MEDIAN PRICE PER SQUARE FOOT
OAKLAND
Employment: 2.9%
EMPLOYMENT TRENDS
METRO
YEAR-OVER-YEAR CHANGE
6%
The East Bay continues to welcome corporations relocating
from higher-priced offices in San Francisco and the Silicon
Valley. Although overall job growth slowed in 2016 to 2.8
percent, regional employers are expected to add more positions
in 2017, pushing employment growth to 2.9 percent. The
largest contributor to the economy is the trade, transportation
and utilities sector, bolstered by the Port of Oakland. The port
recently opened a new shipping route between China and
Vietnam last year, and commenced build-outs to its container
terminal that will accommodate mega ships. The professional
and business services sector keeps growing as tech firms and
other companies head east across the Bay Bridge. Uber plans
to move into Oakland’s 330,000-square foot Uptown Station
in 2017, while Makani Power, a subsidiary of Google, plans to
lease another 65,000 square feet in Alameda.
0%
-3%
-6%
09
10
11
12
13
14
15
16
17*
YEAR
PERMITS
UNITS (000S)
4
SINGLE-FAMILY
MULTIFAMILY
3
2
An exodus of renters from pricey San Francisco fueled home
price and SFR growth in Oakland over the past three years.
Both the owner-occupied and investment housing markets
reported strong gains. While the owner-occupied median
home price of $649,000 exceeds the median investment price
of $475,000, demand among investors remains strong as SFR
cap rates dropped below 4 percent, reaching 3.9 percent last
year. Nonetheless, investors will compete for a limited number
of East Bay assets. The percentage of housing inventory
acquired for investment purposes plunged 3 percentage
points to 17.6 percent in 2016, a seven-year low. Revitalized
Oakland neighborhoods, such as Fruitvale, provide SFR
investors with the ability to earn solid yields, while Alameda,
Livermore and San Leandro offer longer-term appreciation
opportunities.
1
0
08
09
10
11
*Annualized 3Q 2016
12
13
14
15
16*
YEAR
VACANCY & RENT
SFR RENT
$3,200
VACANCY
8%
$1,600
4%
$800
2%
$0
0%
MONTHLY RENT
6%
09
10
11
12
13
14
15
16
VACANCY
$2,400
*Forecast
MARKET OUTLOOK
• Employment: In 2017, 33,000 positions are expected to be
17*
added after 31,000 additional spots were created last year.
New positions represent a 2.9 percent rise in payrolls.
YEAR
• Vacancy: Oakland vacancies will tighten slightly this year. In
INVESTMENT HOME PRICE TRENDS
MEDIAN PRICE PER SQUARE FOOT
$325
24%
$250
12%
$175
0%
$100
-12%
09
*Through 3Q 2016
10
11
12
13
14
15
2016, market wide vacancy for single-family rentals was 3.5
percent. This year, it is projected at 3.2 percent.
36%
YEAR-OVER-YEAR CHANGE
YEAR-OVER-YEAR CHANGE
PRICE PER SQUARE FOOT
$400
Rents: 4.4%
CORPORATE RELOCATIONS, PORT OF OAKLAND
EXPANSION DRIVE RENT GROWTH IN EAST BAY
US
3%
*Forecast
Vacancy: 30 bp
• Rent: Another high-rent California market, Oakland rents
are projected to grow to $3,009 per month in 2017, a 4.4
percent year-over-year rise.
• Investment: While above-average rent growth and strong
economic expansion are driving vacancy levels down,
investor activity in Oakland is slowing due to high prices.
High costs and a long runway is limiting activity to investors
with extended time horizons.
16*
YEAR
28
ORANGE COUNTY
Employment: 2.1%
Vacancy: 10 bps
EMPLOYMENT TRENDS
HIGH PRICES, LOW CAP RATES FOR
ORANGE COUNTY SFRS SLOW ACTIVITY
METRO
YEAR-OVER-YEAR CHANGE
6%
Orange County employers plan to keep hiring in 2017, adding
another layer of robustness to the economy. New positions
are expected to total 34,000, a 2.1 percent increase for the
year. The high-paying professional and business services
sector remains the biggest contributor to Orange County’s
economic engine. Indicative of the region’s ongoing growth,
the construction sector expanded at the highest rate of all
nonfarm industries, jumping 5.7 percent year-over-year in
2016. Commercial projects will rise with the influx of new
construction workers. SpaceX leased 8,000 square feet of
office space in Irvine, making it the company’s third location in
California. Five Lagunas, a 68-acre site at the former Laguna
Hills Mall, is being redeveloped into an urban town center-style
property with luxury multifamily units, a movie theater, a park
and indoor and outdoor shops. Rent growth of 5.8 percent in
Orange County reached an eight-year high in 2015, pinnacling
at $2,924. Substantial additions to the rental housing inventory
– both multifamily and SFRs – will place downward pressure
on 2017 rents, which will moderate to growth of 2.8 percent in
2017. SFR vacancy dropped roughly 20 basis points from 2016
to a low of 2.9 percent.
0%
-3%
-6%
09
10
11
12
*Forecast
13
14
15
16
17*
YEAR
PERMITS
8
SINGLE-FAMILY
MULTIFAMILY
UNITS (000S)
6
4
2
0
08
The investment housing market hasn’t shown any signs of
cooling in Orange County. Median investment prices shot up
11 percent to the low-$700,000 area, relatively in-line with
owner-occupied prices. Institutional investors have all but
left the region as transactions rarely pencil out from a yields
perspective. Cap rates plummeted to the low-3 percent range,
marking a five-year low. The number of retail homebuyers also
declined annually since 2015. For investors seeking strong
appreciation, SFRs in the coastal communities of Huntington
Beach and Costa Mesa offer stable renter pools, while inland
buyers may find higher returns in Tustin and Yorba Linda.
09
10
11
12
13
14
15
16*
YEAR
VACANCY & RENT
SFR RENT
$3,600
VACANCY
8%
$2,600
4%
$2,100
2%
MONTHLY RENT
6%
$1,600
MARKET OUTLOOK
0%
10
11
12
13
*Forecast
• Employment: Payrolls are forecast to expand 2.1 percent in
2017, as 34,000 new jobs are created in Orange County.
Last year, employers added 38,000 spots.
VACANCY
$3,100
09
14
15
16
17*
YEAR
INVESTMENT HOME PRICE TRENDS
Vacancy: Vacancy is projected to decrease by 10 basis
points to 2.9 percent in Orange County this year.
to expand by 2.8 percent to $3,202 by the end of 2017.
Investment: Investors interested in Orange County are
banking on long-term appreciation. Tight cap rates and skyhigh entry prices are leading the majority of investors to be
selective when considering assets.
MEDIAN PRICE PER SQUARE FOOT
30%
YEAR-OVER-YEAR CHANGE
$350
15%
$300
0%
$250
-15%
$200
-30%
09
*Through 3Q 2016
29
10
11
12
13
YEAR
14
15
16*
YEAR-OVER-YEAR CHANGE
PRICE PER SQUARE FOOT
$400
• Rent: Asking rents for SFRs in Orange County are projected
•
US
3%
*Annualized 3Q 2016
•
Rents: 2.8%
ORLANDO
Employment: 3.2%
METRO
YEAR-OVER-YEAR CHANGE
US
The Orlando market has the second-highest projected
employment growth of all the Florida metros. With a forecast
39,000 jobs to be added to the metro, local payrolls will expand
3.2 percent this year. Technology and tourism will fuel growth
as the leisure and hospitality and professional and business
services sectors add thousands of new positions. Deloitte, for
example, is adding 800 IT positions with an average salary
of $70,000 to its Lake Mary center expansion. Additionally,
the company plans to invest $246 million in Orlando for
the development of an upgraded technology development
center. Another major project taking place beginning this
year Is the $1.8 billion expansion of the Orlando International
Airport. Expected to take at least three years to develop, this
project will create many temporary construction jobs, as well
as hundreds of permanent positions upon completion of the
terminal in 2020.
3%
0%
-3%
-6%
09
10
11
12
*Forecast
13
14
15
16
17*
YEAR
PERMITS
UNITS (000S)
16
SINGLE-FAMILY
MULTIFAMILY
12
8
Orlando’s robust economy has created demand for housing,
which has placed upward pressure on median sales prices
for both investment homes and owner-occupied properties.
As a result, cash sales are down as investors use leverage to
acquire assets at higher price points. However, while prices
increase across the board, both classes of buyers are moving
down the quality scale into older neighborhoods. Overall sales
for both investment and traditional purchases are down from
2015 levels, largely due to price gains. Institutional activity has
also declined as foreclosure inventory dries up. Cap rates fell
20 basis points between in 2016, though they remain very
attractive. At the end of last year, first-year returns were north
of 6 percent. Strong rent growth should offset rising prices,
keeping average cap rates near their current range this year.
4
0
08
09
10
11
*Annualized 3Q 2016
12
13
14
15
16*
YEAR
VACANCY & RENT
SFR RENT
VACANCY
24%
$1,200
18%
$800
12%
$400
6%
$0
0%
VACANCY
MONTHLY RENT
$1,600
Rents: 3.5%
HEALTHY TOURISM CREATING RENTER
HOUSEHOLDS IN ORLANDO
EMPLOYMENT TRENDS
6%
Vacancy: 300 bps
MARKET OUTLOOK
09
10
11
12
13
*Forecast
14
15
16
• Employment: The pace of employment growth in Orlando is
17*
forecast at 3.2 percent as employers add 39,000 positions.
YEAR
• Vacancy: Vacancy at SFRs will continue its strong downward
trend, dropping nearly 300 basis points to 2.8 percent. Last
year, vacancy plunged 320 basis points.
INVESTMENT HOME PRICE TRENDS
MEDIAN PRICE PER SQUARE FOOT
24%
YEAR-OVER-YEAR CHANGE
$100
12%
$80
0%
$60
-12%
$40
YEAR-OVER-YEAR CHANGE
PRICE PER SQUARE FOOT
$120
• Rent: Rents in Orlando grew to $1,469 per month, up 3.5
percent from 2016 when single-family rentals closed the
year at $1,419 per month.
• Investment: Orlando SFRs continue to draw investors to the
market. Tourism, which supports thousands of jobs in the
metro, often precludes homeownership for local residents.
As a result, investors can capitalize on this high-demand
market in 2017.
-24%
09
*Through 3Q 2016
10
11
12
13
14
15
16*
YEAR
30
PHOENIX
Employment: 2.4%
NEW SUPPLY WILL APPLY UPWARD PRESSURE
ON VACANCY IN PHOENIX THIS YEAR
Rents: 2.5%
Vacancy: 40 bps
EMPLOYMENT TRENDS
METRO
YEAR-OVER-YEAR CHANGE
8%
The Phoenix job engine is performing well, supporting demand
for rental units across the Valley. Construction employment
has been a standout sector over the past year, expanding by
nearly 10 percent in 2016. A mix of residential and commercial
projects are fueling the rise in development jobs, a trend that
is expected to continue. At the end of last year, more than
11,000 multifamily rental units were underway, most of which
will be completed this year. As rental construction peaks in
2017, single-family landlords will compete with a wave of new,
Class A apartments. As a result, single-family vacancy will tick
higher while rent growth abates. Nonetheless, the long-term
prospects for the market remain positive due to the area’s
healthy economic picture. For instance, Farmers Insurance
is considering an expansion that will create 1,000 jobs in the
market, joining State Farm who is in the process of adding
8,000 Phoenix jobs.
US
4%
0%
-4%
-8%
09
10
11
12
*Forecast
13
14
15
16
17*
YEAR
PERMITS
UNITS (000S)
16
Phoenix was a magnet for investors during the first few
years following the recovery, however, with a dearth of deals
available, this draw is declining. Following national trends,
cash investment sales are on the decline and barely outpace
national levels. Prices for both traditional and investment sales
are growing, which has resulted in a decline in cap rates in
the metro. In fact, the median investment sales price shot up
to $179,000 in the metro at the end of last year. Heading into
2017, average first-year returns were in the high-4 percent
range, down approximately 20 basis points from one year
ago. In spite of this upswing in pricing, investors seeking
returns, should look to emerging markets like Sunnyslope and
Northeast Phoenix, while older neighborhoods in Scottsdale
and Tempe continue to appreciate in value over the long term.
SINGLE-FAMILY
MULTIFAMILY
12
8
4
0
08
09
10
11
*Annualized 3Q 2016
12
13
14
15
16*
YEAR
VACANCY & RENT
SFR RENT
VACANCY
20%
$1,050
16%
$700
12%
$350
8%
VACANCY
MONTHLY RENT
$1,400
MARKET OUTLOOK
• Employment: Payrolls are forecast to jump 2.4 percent this
$0
4%
09
year as employers add 48,000 new positions.
10
11
12
13
*Forecast
14
15
16
17*
YEAR
• Vacancy: Vacancy levels are expected to increase by 40
basis points this year to 6.3 percent.
INVESTMENT HOME PRICE TRENDS
PRICE PER SQUARE FOOT
$120
projected to grow 2.5 percent to $1,380 per month.
•
Investment: Prices are growing, which has resulted in
a decline in cap rates in the metro. Heading into 2017,
average first-year returns were in the high-4 percent
range, down approximately 20 basis points. Investors are
taking advantage of Phoenix SFR acquisitions due to their
attractiveness relative to nearby West Coast metros.
MEDIAN PRICE PER SQUARE FOOT
28%
YEAR-OVER-YEAR CHANGE
$100
14%
$80
0%
$60
-14%
$40
-28%
09
*Through 3Q 2016
31
10
11
12
13
YEAR
14
15
16*
YEAR-OVER-YEAR CHANGE
• Rent: In 2017, single-family rents in the Phoenix metro are
PORTLAND
Employment: 2.5%
YEAR-OVER-YEAR CHANGE
6%
US
Portland had a standout year from an economic growth
perspective and the residential real estate market continues
to heat up. Employers added 31,000 jobs to the local economy
in 2016, growing at a rate of 2.8 percent. In 2017, payrolls will
rise 2.5 percent. The trade, transportation and utilities sector,
as well as professional and business services, serve as the
main drivers of the local economy, yet manufacturing remains
strong, thanks to major regional employers like Intel. Contrary
to the national trend, a flood of VC money has entered the local
market: In 3Q 2016, $87 million in VC funding closed, three
times more deals than during the same time period in 2015.
A testament to the region’s popularity as a metropolis that
attracts innovative thinkers, many of whom are Generation X
and Millennial renters, Portland ranked fourth on the U.S. Clean
Tech Leadership Index, a measure focused on technology
policy and capital with respect to clean technology and green
practices. Despite builders responding to the pent-up demand
for housing units by expanding overall inventory, rent growth
in this market is still strong, achieving a 3.2 percent expansion
this year. In fact, rent growth has been sliced in half each year
since 2015 when it skyrocketed 12.8 percent.
3%
0%
-3%
-6%
09
10
11
12
*Forecast
13
14
15
16
17*
YEAR
PERMITS
UNITS (000S)
8
SINGLE-FAMILY
MULTIFAMILY
6
4
2
0
08
09
10
11
*Annualized 3Q 2016
12
13
14
15
16*
YEAR
Strong renter demand in Portland will bode well for SFR
investors with the financial wherewithal to acquire properties
in the area. Year-over-year investment home prices soared 8
percent in 2016 to $300,000, while cap rates have remained
in the low 4-percent-range for the past nine years. Investment
sales comprise more than one-fifth of the area’s housing
inventory, and a significant share of those buyers – 55 percent
– are using all cash. That compares to 51.2 percent of investors
nationwide utilizing cash. Investors searching for appreciation
will target the submarkets of Lents and Pleasant Valley.
VACANCY & RENT
SFR RENT
VACANCY
6%
$1,600
5%
$1,200
4%
$800
3%
$400
VACANCY
MONTHLY RENT
$2,000
MARKET OUTLOOK
2%
09
10
11
12
13
*Forecast
14
15
16
17*
• Employment: Still outperforming national levels, employers
YEAR
in Portland are projected to increase employment levels by
2.5 percent. This is an addition of 29,000 jobs. Last year,
31,000 new spots were created.
INVESTMENT HOME PRICE TRENDS
MEDIAN PRICE PER SQUARE FOOT
24%
YEAR-OVER-YEAR CHANGE
$175
12%
$150
0%
$125
-12%
$100
-24%
09
*Through 3Q 2016
10
11
12
13
14
15
• Vacancy: Vacancy is projected to grow by 60 basis points
YEAR-OVER-YEAR CHANGE
PRICE PER SQUARE FOOT
$200
Rents: 3.2%
LED BY AN INFLUX OF VENTURE CAPITAL TO
REGION, PORTLAND’S ECONOMY STRENGTHENS
EMPLOYMENT TRENDS
METRO
Vacancy: 60 bps
to 5.5 percent in 2017. In 2016, levels were at 4.9 percent.
• Rent: Portland is expected to experience solid single-family
rent growth this year. In 2017, rents are forecast to grow 3.2
percent to $1,902 per month.
• Investment: Investor demand in this region remains strong,
due to excellent employment growth and additions in the
Millennial population.
16*
YEAR
32
RALEIGH-DURHAM
Employment: 2.4%
RALEIGH-DURHAM SFR INVESTMENT MARKET
TRACKS TO NATIONAL SFR TRENDS
Vacancy: 130 bps
Rents: 2.7%
EMPLOYMENT TRENDS
METRO
YEAR-OVER-YEAR CHANGE
6%
The largest employment sectors in the Raleigh-Durham
investment market are the professional and business services,
as well as the trade, transportation and utilities, which are
expected to keep growing in 2017. Local employers plan to
add 22,000 jobs this year, an improvement over the 20,000
gained in 2016. Raleigh’s 2.4 percent payroll expansion
matches the national rate. Tech is a major driver of growth.
Citrix Systems, for example, will add 400 new positions to the
economy over the next five years. Supply additions will begin
to apply greater pressure on rental conditions. Single-family
permitting has remained elevated over the past four years.
The Far North Raleigh and North Cary/Morrisville submarkets
are well-positioned to handle new supply, which should keep
SFR vacancy in these areas low.
US
3%
0%
-3%
-6%
09
10
11
12
*Forecast
13
14
15
16
17*
YEAR
PERMITS
UNITS (000S)
16
In addition to a steady economic performance, low singlefamily vacancy and strong projections for rent growth will draw
investors to the Raleigh-Durham market. A modest rise in new
supply last year ensures that prices will remain competitive.
As with most other markets, overall investment volume in the
metro has slowed over the past two years; however, cash
investment purchases are rising. In fact, more than 75 percent
of last year’s investments in Raleigh-Durham were purchased
using cash. Additionally, cap rates have remained steady in
this market since the recovery, luring investors with a mid5 percent return, a performance that follows the national
trend. While traditional buyers are moving up the quality
scale in Raleigh-Durham into newer properties, investors are
remaining in neighborhoods of similar quality, albeit in smallersized homes.
SINGLE-FAMILY
MULTIFAMILY
12
8
4
0
08
09
10
11
*Annualized 3Q 2016
12
13
14
15
16*
YEAR
VACANCY & RENT
SFR RENT
MARKET OUTLOOK
VACANCY
12%
$1,200
9%
$800
6%
$400
3%
• Employment: Employers in the Raleigh-Durham metro are
0%
$0
expected to add 22,000 new positions this year, a growth
of 2.4 percent over last year. In 2016, 20,000 new openings
were created.
VACANCY
MONTHLY RENT
$1,600
09
10
11
12
13
*Forecast
14
15
16
17*
YEAR
• Vacancy: Raleigh’s single-family rental vacancy is expected
INVESTMENT HOME PRICE TRENDS
PRICE PER SQUARE FOOT
$120
• Rent: In Raleigh, single-family rents are anticipated to grow
2.7 percent to $1,492 per month.
• Investment: The research triangle generates a significant
share of renter demand. Young tech workers and current
university students tend to prefer renting over ownership,
providing SFR operators ample opportunities to keep
occupancy levels high.
MEDIAN PRICE PER SQUARE FOOT
24%
YEAR-OVER-YEAR CHANGE
$100
12%
$80
0%
$60
-12%
$40
-24%
09
*Through 3Q 2016
33
10
11
12
13
YEAR
14
15
16*
YEAR-OVER-YEAR CHANGE
to end the year at 3.3 percent. Last year, the vacancy rate
was 4.6 percent.
SAN ANTONIO
Employment: 1.9%
YEAR-OVER-YEAR CHANGE
6%
US
3%
The San Antonio metro hums along steadily with 19,000
new jobs projected to be added this year, a 1.9 percent gain.
Overall, the rapid explosion in employment following the
recession has slowed as the energy sector has dragged on
overall growth. Within the market, trade, transportation and
utilities, education and health services, and government make
up three of the largest sectors of economy, and are expected
to continue their growth. As part of a grant from the Economic
Development Incentive Fund, Oracle America, Inc. will add 350
jobs to the metro, with a minimum salary of $50,000. During
the fourth quarter of 2016, a $175 million redevelopment
project was begun on San Antonio’s San Pedro Creek. This
“second River Walk” is expected to drive demand and further
new development in a currently underutilized portion of the
city’s downtown. This may lure further corporate expansions
and relocations to this region of the metro in the coming years.
0%
-3%
-6%
09
10
11
12
*Forecast
13
14
15
16
17*
YEAR
PERMITS
UNITS (000S)
8
SINGLE-FAMILY
MULTIFAMILY
6
4
Home prices in San Antonio continue to grow across both
the traditional and investor segments. As with most markets
across the nation, traditional home buyers are moving into
higher priced properties in newer neighborhoods. Investors in
this market, however, are remaining in mid-tier neighborhoods
where renter demand is strong. Cap rates in San Antonio
continue to outperform national rates, though they have
dropped to just below 7 percent. Projected rent growth for
2017 has also dropped slightly; rents are expected to increase
1.7 percent over 2016 levels. Slower NOI growth and strong
appreciation could place downward pressure on first-year
returns this year.
2
0
08
09
10
11
*Annualized 3Q 2016
12
13
14
15
16*
YEAR
VACANCY & RENT
SFR RENT
VACANCY
14%
$1,400
12%
$1,200
10%
$1,000
8%
$800
6%
09
10
11
12
13
*Forecast
14
15
16
VACANCY
MONTHLY RENT
$1,600
MARKET OUTLOOK
• Employment: Employment growth in San Antonio remains
steady, expanding by 1.9 percent, with 19,000 new spots
expected this year. Last year, employers added 13,500
positions.
17*
YEAR
•
INVESTMENT HOME PRICE TRENDS
MEDIAN PRICE PER SQUARE FOOT
16%
YEAR-OVER-YEAR CHANGE
$90
8%
$80
0%
$70
-8%
$60
YEAR-OVER-YEAR CHANGE
PRICE PER SQUARE FOOT
$100
*Through 3Q 2016
10
11
12
13
14
15
Vacancy: Vacancy remains elevated in San Antonio. In
2016, it was 9.5 percent. This year, it is expected to improve
slightly and end the year at 9.4 percent.
• Rent: In 2016, San Antonio rents ended the year at $1,399
per month. This year, landlords are expecting a 1.7 percent
improvement, raising rents to $1,423 per month.
•
-16%
09
Rents: 1.7%
STABILIZING ENERGY PRICES, EXPANDING
PAYROLLS SUPPORT SFR FUNDAMENTALS IN
ALAMO CITY
EMPLOYMENT TRENDS
METRO
Vacancy: 10 bps
16*
YEAR
34
Investment: Planned redevelopment of the San Pedro
Creek region of downtown San Antonio will drive new
development in the coming years. With steady employment
and declining vacancies, this submarket still will retain longterm potential for single-family investors.
SAN DIEGO
Employment: 2.5%
TECHNOLOGY SECTOR DRIVES RENTER DEMAND
IN SAN DIEGO; VACANCY LEVELS REACH NEW LOW
Vacancy: 90 bps
Rents: 3.5%
EMPLOYMENT TRENDS
METRO
YEAR-OVER-YEAR CHANGE
6%
The technology and biotech sectors have reshaped San
Diego, bolstering job growth and contributing to the metro’s
economic expansion. Last year, the economy grew 2.3 percent
as local employers added 32,000 new positions, yet in 2017,
the economy is projected to grow even further to 2.5 percent
with the addition of 36,000 new jobs. According to startup
accelerator CONNECT, the innovation sector accounts for $52
billion, or 24 percent of the region’s gross GDP. San Diego
County ranks among the top 10 for startup activity, launching
405 new companies in 2015 and is No. 1 in the country for
life sciences startups. The San Diego Regional Economic
Development Corp. also recently reported that the metro
ranks seventh among the top 50 U.S. metros for its software
industry, ahead of Austin, New York City and Portland. In 2017,
vacancy is anticipated to dip to 1.6 percent, a decade-low rate.
US
3%
0%
-3%
-6%
09
10
11
12
*Forecast
13
14
15
16
17*
YEAR
PERMITS
8
MULTIFAMILY
6
UNITS (000S)
Investors are relatively active in the market, though high entry
costs limit the amount of activity. The number of investment
sales as a percent of overall transactions is well below the
national average due to tight conditions. Nonetheless,
buyers willing to bring a significant amount of cash to each
transaction can find attractive deals. Typically, leveraged
investors are counting on appreciation as a primary source of
wealth creation. Average cap rates for investment properties
are in the mid-3 percent range. Upward pressure on yields,
particularly in some heated coastal areas, should materialize
as interest rates climb in the coming months. Over the past
four years, average cap rates have remained relatively stable
in the mid- to high-3 percent range despite rising prices. To
achieve these yields, investors have moved further away from
the coast where prices can be significantly lower. This year,
rising capital costs will shrink the pool of deals that pencil out,
requiring investors to do more due diligence.
SINGLE-FAMILY
4
2
0
08
09
10
11
*Annualized 3Q 2016
12
13
14
15
16*
YEAR
VACANCY & RENT
SFR RENT
VACANCY
12%
$2,100
9%
$1,400
6%
$700
3%
$0
0%
09
MARKET OUTLOOK
10
11
12
13
*Forecast
• Employment: This year, 36,000 new positions are expected
VACANCY
MONTHLY RENT
$2,800
14
15
16
17*
YEAR
to be created in San Diego, a 2.5 percent gain.
INVESTMENT HOME PRICE TRENDS
• Vacancy: SFR vacancy remains extremely tight in San Diego.
$320
PRICE PER SQUARE FOOT
• Rent: By year-end, rents are forecast to tick up to $2,616 per
month, a 3.5 percent gain for the year.
• Investment: With a higher cost of entry, investors in San
Diego tend to rely on leverage. Cap rates in this market
have been consistent around 3 percent. To maintain these
yields, single-family investors are moving inland, where
price growth is less heated than the coast.
36%
YEAR-OVER-YEAR CHANGE
$265
24%
$210
12%
$155
0%
$100
-12%
09
*Through 3Q 2016
35
10
11
12
13
YEAR
14
15
16*
YEAR-OVER-YEAR CHANGE
This year, it is expected to drop to 1.6 percent, down 90
basis points for the year.
MEDIAN PRICE PER SQUARE FOOT
SAN FRANCISCO
Employment: 2.7%
YEAR-OVER-YEAR CHANGE
6%
US
San Francisco employment growth has slowed due to a
decrease in VC funding. Last year, the metro added 31,000
jobs, expanding 2.6 percent annually, and is forecast to grow
2.7 percent in 2017. The professional and business services
sector fuels the metro’s economy, led by the high-tech and
biotech/life sciences sectors. In South San Francisco, a JV
acquired The Landing at Oyster Point for $171 million. Starting
in 2018, it plans to redevelop the site into a $1 billion office
and R&D complex. Meanwhile, Mission Rock, a project in San
Francisco’s Mission Bay district, will include office, retail and
residential space near AT&T Park, as well as a new pier facility
for locally based Anchor Brewing Co. The developer will also
set aside 40 percent of the 1,500 units for lower- and middleincome residents. Voters in the city of San Francisco passed
a measure that requires one-quarter of all new housing units
to be affordable, thus slowing the pace of new multifamily
construction in 2017. The measure, known as Proposition C,
will also place downward pressure on already-tight vacancies.
3%
0%
-3%
-6%
09
10
11
12
*Forecast
13
14
15
16
17*
YEAR
PERMITS
UNITS (000S)
8
SINGLE-FAMILY
MULTIFAMILY
6
4
2
With the tech VC funding spigot flowing slower in the Bay
Area, San Francisco’s luxury housing market has started to
soften, yet the market for mid- to lower-priced owner-occupied
and investment homes remains solid. Overall median owneroccupied housing prices exceeded $1.2 million in the metro
last year, whereas median SFR prices in the metro topped $1
million. With double-digit investment home price growth and
low cap rates, most of the region’s inventory remains out-ofreach for investors. Prices for investment housing in urban
infill areas like Mission Bay remain out of reach for investors
seeking yields, so instead target the East Bay.
0
08
09
10
11
*Annualized 3Q 2016
12
13
14
15
16*
YEAR
VACANCY & RENT
SFR RENT
$4,400
VACANCY
8%
$2,200
4%
$1,100
2%
$0
0%
MONTHLY RENT
6%
10
11
12
13
*Forecast
14
15
16
VACANCY
$3,300
09
Rents: 1.7%
VENTURE CAPITAL, FUNDING SLOWDOWN IMPACT
SAN FRANCISCO’S REAL ESTATE MARKET
EMPLOYMENT TRENDS
METRO
Vacancy: 30 bps
MARKET OUTLOOK
• Employment: Job growth is anticipated to accelerate to 2.7
percent this year, as 33,000 positions are created. Last year,
31,000 spots were filled.
17*
YEAR
• Vacancy: This year, vacancy is anticipated to drop to 3.2
percent by the end of the year, representing a 30-basis
point decline.
INVESTMENT HOME PRICE TRENDS
MEDIAN PRICE PER SQUARE FOOT
28%
YEAR-OVER-YEAR CHANGE
$600
14%
$400
0%
$200
-14%
$0
YEAR-OVER-YEAR CHANGE
PRICE PER SQUARE FOOT
$800
• Rent: Single-family rents are forecast to grow 1.7 percent to
$4,390 per month in 2017.
•
-28%
09
*Through 3Q 2016
10
11
12
13
14
15
16
YEAR
36
Investment: One of the highest-priced markets in the
country, SFR investors in San Francisco are focusing on
farther-flung submarkets where cap rates are highest.
With entry prices exceeding $1 million, most investors are
seeking alternative markets.
SAN JOSE
Employment: 3.3%
SILICON VALLEY TECH STANDBYS LEAD
SAN JOSE’S ECONOMIC GROWTH
Vacancy: 60 bps
Rents: 1.4%
EMPLOYMENT TRENDS
METRO
YEAR-OVER-YEAR CHANGE
6%
A well-educated workforce and innovative tech companies will
continue to drive San Jose’s economy. Employment growth
in 2017 is expected to remain on par with last year’s growth,
edging up slightly to 3.3 percent. Employers in the region will
add 36,000 jobs, courtesy of such tech stalwarts as Cisco
Systems, eBay, Facebook, Google, Intel and Oracle. While
VC funding firms have slowed financing for startups across
the U.S., VCs are still investing in Silicon Valley companies.
Andreessen Horowitz and KleinerPerkinsCaufield & Byers
(KPCB), both based in Menlo Park, led the Bay Area in VC
funding during the second quarter of 2016, raising $1.5 billion,
while KPCB raised $1 billion. Meanwhile, the Saudi Arabia
Investment Fund made a $3.5 million commitment to Uber
Technologies, one of the region’s standout companies. On the
supply side, the addition of new units kept rents in check last
year. In 2017, SFR rents are anticipated to rise 1.4 percent to
roughly $3,700 per month.
US
3%
0%
-3%
-6%
09
10
11
12
*Forecast
13
14
15
16
17*
YEAR
PERMITS
UNITS (000S)
8
Investment and owner-occupied homes still trade at premium
values in San Jose, although price growth has shown some
signs of abating, especially in the luxury sector. SFR price
growth peaked in 2013, but has since dropped to about onethird of those levels, rising 9.7 percent in 2016 to $900,000.
In addition, investment housing cap rates declined 10 basis
points in 2016 to an eight-year low of 3.2 percent, making the
investment housing market out-of-reach for most investors.
SFR buyers snagged more than 13 percent of the region’s
homes as investments in 2015, compared to 7 percent of
homes as investments in 2016. SFR housing prices remain at
a premium in the Silicon Valley, although investors seeking
long-term appreciation may want to target infill San Jose
neighborhoods away from the higher-priced Silicon Valley and
downtown markets.
SINGLE-FAMILY
MULTIFAMILY
6
4
2
0
08
09
10
11
*Annualized 3Q 2016
12
13
14
15
16*
YEAR
VACANCY & RENT
SFR RENT
$4,000
VACANCY
8%
$3,000
4%
$2,500
2%
MONTHLY RENT
6%
$2,000
0%
09
MARKET OUTLOOK
10
11
12
13
*Forecast
• Employment: Staffing levels are projected to expand 3.3
VACANCY
$3,500
14
15
16
17*
YEAR
percent as 36,000 positions are created, building on last
year’s 35,000 jobs.
INVESTMENT HOME PRICE TRENDS
$700
PRICE PER SQUARE FOOT
year, landlords should expect 5.0 percent vacancy, up 60
basis points year-over-year.
• Rent: Market-rate rents in San Jose are expected to rise 1.4
percent to $3,719 per month by the end of the 2017.
• Investment: While demand for rentals in this market remains
healthy, high prices will keep most investors out of this
market. Those with the resources to continue to expand
their portfolios will come to the table with significant cash.
36%
YEAR-OVER-YEAR CHANGE
$550
24%
$400
12%
$250
0%
$100
-12%
09
*Through 3Q 2016
37
10
11
12
13
YEAR
14
15
16*
YEAR-OVER-YEAR CHANGE
• Vacancy: SFR vacancy is expected to inch up in 2017. This
MEDIAN PRICE PER SQUARE FOOT
SEATTLE
Employment: 3.3%
YEAR-OVER-YEAR CHANGE
6%
US
The Seattle economy peaked in 2016, with employment
growth of a stellar 3.9 percent – an eight-year high. A total of
63,000 positions were added to the local economy. This year,
growth will decline to 3.3 percent, but is still strong by national
standards. Employers will add 56,000 positions to the local
economy, led by the booming construction sector. A newly
constructed 36-story skyscraper by local developer Martin
Selig in Belltown fueled the construction sector’s expansion.
WeLive, the sister company to co-working firm WeWork,
signed a 500,000-square foot lease at the tower for use as
a co-living space, an innovative concept that’s new to the
West Coast. Amazon, the metro’s largest employer, continued
its expansion with 286,000 square feet of new space at
a South Lake Union office building in early 2016. In spite of
new housing supply, vacancy is expected to drop 80 basis
points in 2017 to a decade-low rate of 2.1 percent. Rent growth,
however, will slow to 5.5 percent to $2,350 per month.
3%
0%
-3%
-6%
09
10
11
12
*Forecast
13
14
15
16
17*
YEAR
PERMITS
UNITS (000S)
16
SINGLE-FAMILY
MULTIFAMILY
12
8
Price growth for Puget Sound SFRs has remained strong due
to high renter demand derived from job growth. A wave of
investors from China and other foreign countries pouring
capital into the local market drove median prices for all
types of homes to $450,000 last year after British Columbia
levied a 15 percent tax on foreign buyers purchasing homes
in Vancouver. The percentage of investment home sales,
however, dropped 120 basis points year-over-year to 18.3
percent, while the number of cash buyers active in the market
dropped 500 basis points to 52.1 percent in 2016. For SFR
investors seeking yields, Columbia City offers inventory, while
West Seattle’s popular neighborhoods are strong long-term
appreciation plays.
4
0
08
09
10
11
*Annualized 3Q 2016
12
13
14
15
16*
YEAR
VACANCY & RENT
SFR RENT
VACANCY
8%
$1,800
6%
$1,200
4%
$600
2%
$0
0%
VACANCY
MONTHLY RENT
$2,400
Rents: 5.5%
TECH HIRING SPURRING STRONG JOB GROWTH
AND RENTER DEMAND IN SEATTLE
EMPLOYMENT TRENDS
METRO
Vacancy: 80 bps
MARKET OUTLOOK
09
10
11
12
13
*Forecast
14
15
16
17*
Employment: Employment is projected to expand 3.3
percent as 56,000 positions are created in 2017.
•
Vacancy: Seattle’s single-family rental vacancy remains
tight. This year, the rate is anticipated to decline 80 basis
points to 2.1 percent.
YEAR
INVESTMENT HOME PRICE TRENDS
$120
MEDIAN PRICE PER SQUARE FOOT
24%
YEAR-OVER-YEAR CHANGE
$100
12%
$80
0%
$60
-12%
$40
YEAR-OVER-YEAR CHANGE
PRICE PER SQUARE FOOT
•
• Rent: Asking rents are expected to see steady growth in
2017 as operators lift rents 5.5 percent to $2,347 per month.
• Investment: Seattle still has some inventory for those with
the resources to manage the market’s higher entry prices.
Investors interested in stronger immediate yields will focus
on the Columbia City submarket, while those seeking longterm growth from appreciation could turn their attention to
West Seattle.
-24%
09
*Through 3Q 2016
10
11
12
13
14
15
16*
YEAR
38
TAMPA
Employment: 2.3%
HIGH YIELDS AND STRONG JOB GAINS KEEP
TAMPA AMONG MOST ATTRACTIVE MARKETS
Vacancy: 10 bps
Rents: 2.8%
EMPLOYMENT TRENDS
METRO
YEAR-OVER-YEAR CHANGE
6%
Similar to the other major Florida markets, strong job growth is
expected for Tampa in 2017. Employment sectors responsible
for Tampa’s growth include trade, transportation and utilities;
professional and business services; and education and health
services. One of the largest expansions in this space is being
undertaken by BlueGrace Logistics, a private-equity funded
transportation logistics company. Beginning in 2016, and
extending through 2020, the firm will hire for at least 1,000
new positions. Manufacturing jobs are also seeing a slight
increase in the region, as evidenced by at least three major
expansion projects by Fresco Foods, North American Roofing,
and Johnson & Johnson. In total, these companies will spend
over $25 million on growing their respective presences, while
creating a minimum of 750 new positions in the metro. Other
notable projects include Accusoft and Iron Boy Technologies.
The former is a Tampa-based imaging company that will
double its workforce by 2021. In total, the company will create
125 new positions, each paying $75,000 or more, annually.
The latter is a Virginia-based tech support company, that will
open a Tampa customer service center and hire for at least
170 additional positions.
US
3%
0%
-3%
-6%
09
10
11
12
*Forecast
13
14
15
16
17*
YEAR
PERMITS
UNITS (000S)
12
SINGLE-FAMILY
MULTIFAMILY
9
6
3
0
08
09
10
11
*Annualized 3Q 2016
While Florida was late to the recovery, price growth has
rebounded for both traditional and investment homes. More
investors are utilizing leverage than previously, however,
the percentage of cash investment sales still outpace
national levels. Appreciation has also led to a decrease in
the percentage of investment sales in the Tampa market,
mirroring the national trend. Nonetheless, average cap rates
remain attractive, above 7 percent, though have experienced
a slight compression in the past year. While investors in
other Florida markets such as Orlando and Jacksonville have
moved down the quality scale to compensate for the growth
in prices, investors in Tampa continue to invest in the same
neighborhoods as the year prior.
12
13
14
15
16*
YEAR
VACANCY & RENT
SFR RENT
VACANCY
15%
$1,200
12%
$800
9%
$400
6%
$0
VACANCY
MONTHLY RENT
$1,600
3%
09
10
11
12
13
*Forecast
14
15
16
17*
YEAR
MARKET OUTLOOK
• Employment: Employers are expected to add 30,000 new
INVESTMENT HOME PRICE TRENDS
$100
PRICE PER SQUARE FOOT
• Vacancy: Vacancy rates in this market are projected to tick
up slightly from 2016 levels, ending the year at 7.5 percent.
• Rent: By year end, operators are expected to raise rents to
$1,411 per month, up 2.8 percent.
• Investment: Cap rates exceeding 7 percent are drawing
investors searching for above-average yields to Tampa.
While late to the recovery, job growth should support renter
demand across most submarkets.
24%
YEAR-OVER-YEAR CHANGE
$80
12%
$60
0%
$40
-12%
$20
-24%
09
*Through 3Q 2016
39
10
11
12
13
YEAR
14
15
16*
YEAR-OVER-YEAR CHANGE
jobs in 2017, representing a 2.3 percent gain.
MEDIAN PRICE PER SQUARE FOOT
Research Services
HomeUnion’s Research Services team analyzes local, national and global trends to determine the impact of an evolving
economic climate on the performance of single-family rental properties. Utilizing big data and up-to-date economic information,
analysts provide investors and owners the information needed to make investment decisions based on their goals.
Current Investment Locations:
Atlanta
Cleveland
Raleigh-Durham
Austin
Dallas/Fort Worth
San Antonio
Charlotte
Indianapolis
Tampa
Chicago
Orlando
Prepared by:
Senior Management Team:
Steve Hovland, Director-Research and Communications
Don Ganguly, Chief Executive Officer
[email protected]
Stacey Corso, Communications Manager
Chiranjib Pal, Chief Financial Officer
[email protected]
Pasha Manali, Research and Communications Associate
Eden Ellis, Data Scientist
Geri Brewster, Chief Compliance and Risk Officer
[email protected]
40
Contact:
Steve Hovland
Director-Research Services
[email protected]
2010 Main Street, Suite 250
Irvine, California 92614
(949) 229-8625
PHONE
+1-866-732-3220
Don Ganguly
CEO
[email protected]
2010 Main Street, Suite 250
Irvine, California 92614
(866) 732-3220
EMAIL
[email protected]
WEB
www.homeunion.com
Media Contact:
Stacey Corso
Communications Manager
[email protected]
(415) 672-6460
ADDRESS
2010 Main Street, STE 250
Irvine, CA 92614