A strong rebound in the apartment market is boosting multi-family construction, especially in certain parts of the country. Asking rents are up 2% from a year ago, according to RealFacts/Meyers, a real estate research firm specializing in the multi-family industry. Occupancy levels are also high, reaching levels seen in 2007.
Foreclosures dumped approximately 2.5 million households into the rental market, according to one estimate. Those who chose to “double up” with friends and family are now moving out. Gen Y is entering the work force. And many families and individuals are unable or unwilling to commit themselves to a real estate purchase.
Job growth is one of the primary factors in attracting investment dollars and multi-family building activity. Washington, D.C, the coastal areas of California, the Pacific Northwest, Boston, Dallas and Baltimore are in RealFacts/Meyers’ “Top Tier” markets.
In 2010, the nation saw 151,400 multi-family permits issued, a 7% uptick over the previous year, according to RealFacts/Meyers. The numbers for 2011 are projected to be only slightly higher. But in 2012, RealFacts/Meyers predicts more than 300,000 multi-family permits will be issued, and that number will keep climbing until it reaches 600,000 in 2014.