Magazine article Mortgage Banking

Apartment Performance Positive; Rent Growth Slows

Magazine article Mortgage Banking

Apartment Performance Positive; Rent Growth Slows

Article excerpt

The apartment market continues to post positive results, according to Axiometrics Inc., Dallas, posting an annual effective rent growth of 3.53 percent in February.

But Axiometrics President Ron Johnsey noted the rate of rent growth has moderated compared with prior months. "While rent growth has remained steady, the pace has been gradually slowing," he said. "February's annual effective rent growth was the lowest since August 2010."

The growth rate has slowed in nine of the past 10 months as many metropolitan statistical areas (MSAs) are moderating from very strong rent growth the previous three years, Johnsey said. The annual growth rate at the national level peaked at 5.32 percent in July 2011.

Oakland led the list of high-rent-growth metro areas at 7.3 percent, followed by Houston with 6.7 percent, Denver with 6.1 percent, Seattle with 5.3 percent and New York with 5.1 percent rent growth. Only two areas had a negative annual growth rate: Tucson, Arizona, where rent growth contracted 1.52 percent; and Albuquerque, New Mexico, down 0.11 percent.

Examining the sector by class, the report said class-A properties experienced slowing rent growth rates while class-B communities saw steady growth and class-C properties actually saw improving rent growth rates in February. …

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