Rent prices in Austin have been increasing at the fastest rate ever, according to several data analysts that track this information. The culprit? Experts say the supply of homes and apartments for rent is not keeping up with the number of people who want to live in them.
This imbalance, the effects of which are evident in the for-sale market, means prices have ballooned. While rents in Austin have typically increased by up to 5% each year, this past year they have risen nearly 20%, according to some numbers.
“We’ve been tracking the market for 28 years now,” Robin Davis, manager of Apartment Trends, said. “And we’ve never seen this kind of increase.”
This is a weird phenomenon. In almost every other case, if a person doesn't like the price of something, they vote with their dollar by not buying that product, and it either goes down, or goes away. In the case of housing, people really have no other option than to accept the price or be homeless. Don't like the price? Okay, go live in a tent... Whomever is setting the price can probably get away with anything. It will be interesting and depressing to see how high it might get.
Anecdotally I would guess midtown Omaha rents increased in the 10-15% range this past year. I'm hoping the city can avoid a NIMBY/anti-growth movement so we don't see this trend worsen here. Everyone bemoans increasing rents, but common solutions: increasing ADUs, upzoning, and increasing taxes on unoccupied housing/land are all unpopular as well.
Taco wrote: Wed Jan 05, 2022 1:34 pm
Anecdotally I would guess midtown Omaha rents increased in the 10-15% range this past year. I'm hoping the city can avoid a NIMBY/anti-growth movement so we don't see this trend worsen here. Everyone bemoans increasing rents, but common solutions: increasing ADUs, upzoning, and increasing taxes on unoccupied housing/land are all unpopular as well.
I get the argument that if you increase the supply, the demand should be lower and so the price would go down. But we are seeing increasing supply, and the prices aren't adjusting down, yet or soon as it appears. As far as I can tell, the prices are continuing to go up. Add that onto the American population on a decreasing trend... It doesn't add up. I smell a skunk.
I think developers are totally taking advantage of the market. Which, I don't really blame them for doing, more power to 'em. But its just not a phenomenon that I can defend.
Busguy2010 wrote: Wed Jan 05, 2022 2:15 pm
I think developers are totally taking advantage of the market. Which, I don't really blame them for doing, more power to 'em. But its just not a phenomenon that I can defend.
That would require them to all conspire together to inflate prices. They’re competitors. If a landlord can increase occupancy to the level they want by undercutting the completion in price, they’re going to. Two occupied units each paying $1,000 per month is more than one occupied paying $1,500 per month and one vacant unit paying $0 per month.
"Video game violence is not a new problem. Who could forget in the wake of SimCity how children everywhere took up urban planning." - Stephen Colbert
TitosBuritoBarn wrote: Wed Jan 05, 2022 2:39 pm
That would require them to all conspire together to inflate prices. They’re competitors. If a landlord can increase occupancy to the level they want by undercutting the completion in price, they’re going to. Two occupied units each paying $1,000 per month is more than one occupied paying $1,500 per month and one vacant unit paying $0 per month.
I just don't see how this would be defensible, because rents, as far as I know, are not actually that affordable right now. At least in the new buildings, I'm struggling to see even $1,000, let alone less. Like I said, more power to 'em, but simply adding a bunch of $1,000 plus units isn't meritable or praise-able IMO. Its a money grab, especially when they put no effort into design.
But more units is still more units, and they'll lower their prices if demand dictates it. In my experience, there are only two ways to make housing more affordable: decreasing income inequality and easing regulations. Since income inequality is difficult for us to control at the city level, we should focus on regulation: no price caps, no eviction moratoriums, no arduous and arbitrary zoning and codes. Do what we can to decrease risk for landlords and increase number of units constructed. Reduce the time from project initiation to completion and make it simpler to add density throughout the city.
TitosBuritoBarn wrote: Wed Jan 05, 2022 2:39 pm
That would require them to all conspire together to inflate prices. They’re competitors. If a landlord can increase occupancy to the level they want by undercutting the completion in price, they’re going to. Two occupied units each paying $1,000 per month is more than one occupied paying $1,500 per month and one vacant unit paying $0 per month.
I just don't see how this would be defensible, because rents, as far as I know, are not actually that affordable right now. At least in the new buildings, I'm struggling to see even $1,000, let alone less. Like I said, more power to 'em, but simply adding a bunch of $1,000 plus units isn't meritable or praise-able IMO. Its a money grab, especially when they put no effort into design.
The theory is that new units will generally make the price of older units go down. In theory, anyway. By just looking at new units you’re limited yourself to what should be the most expensive on the market
Yesterday’s affordable apartments: On Site Laundry Room, Pool, Exercise Room, Formica Countertops,
Today’s expensive apartments: Swimming Pool, Sun Deck, Controlled Access Parking, Bike Parking, Community Lounge with Coffee Station, 24 Hour State-of-the-Art Fitness Center – Technogym Equipped, Virtual Concierge App, Security Access, Pet-Friendly, Grilling Pavilion, Business Center, Private Meeting Rooms, Nest Thermostat, USB Outlets, Keyless Electronic Unit Entry, Washer and Dryers in All units, Stainless Steel Appliances, Ceiling Fans in All Rooms, TV and Wi-Fi Included, Utilities Included, Granite or Quartz Countertops with Tile Backsplash, Clubhouse with Lounge Seating and HDTV Living Room, Cyber Lounge, Conference room, Resort-Style Pools and Courtyard, Screening Room with 128” Projector screen, Online Payments, Custom Cabinetry and Large Kitchen Islands, Custom Colored Accent walls, Dual Sinks, Frameless Shower Doors, Luxury Bathrooms with Natural Stone Countertops, High Ceilings, Oversized Oval Soaking Tubs, Plush Carpeting in Bedrooms, Spacious Walk-In Closets, Wood-Style Flooring in Living and Dining Areas, Computer Desks In Each Unit, Roof-Top Terraces, Fire Pits, Movie Theater, Sun Tanning Salon, Multi-Purpose Game Room, Spa, Indoor Basketball, Wine Cellar, Gift Wrapping Station, Feng Shui Parks, Water Filtration, Planting Garden, Personal Tanning, Bark Parks, Library, Garages, Electric Car Charging Stations, Recycling Service, Valet Trash, Golf Simulators, Co-Working Spaces, Living Green Walls, Putting Green, Life-sized Chessboard,Valet Parking, Indoor Mail Boxes and Mobile Package Service.
All those amenities and the rising cost to maintain them takes a lot $$$. If today’s renters demand all those amenities, then expect to pay big bucks.
OmahaOmaha wrote: Thu Jan 06, 2022 1:53 pm
Yesterday’s affordable apartments: On Site Laundry Room, Pool, Exercise Room, Formica Countertops,
Today’s expensive apartments: Swimming Pool, Sun Deck, Controlled Access Parking, Bike Parking, Community Lounge with Coffee Station, 24 Hour State-of-the-Art Fitness Center – Technogym Equipped, Virtual Concierge App, Security Access, Pet-Friendly, Grilling Pavilion, Business Center, Private Meeting Rooms, Nest Thermostat, USB Outlets, Keyless Electronic Unit Entry, Washer and Dryers in All units, Stainless Steel Appliances, Ceiling Fans in All Rooms, TV and Wi-Fi Included, Utilities Included, Granite or Quartz Countertops with Tile Backsplash, Clubhouse with Lounge Seating and HDTV Living Room, Cyber Lounge, Conference room, Resort-Style Pools and Courtyard, Screening Room with 128” Projector screen, Online Payments, Custom Cabinetry and Large Kitchen Islands, Custom Colored Accent walls, Dual Sinks, Frameless Shower Doors, Luxury Bathrooms with Natural Stone Countertops, High Ceilings, Oversized Oval Soaking Tubs, Plush Carpeting in Bedrooms, Spacious Walk-In Closets, Wood-Style Flooring in Living and Dining Areas, Computer Desks In Each Unit, Roof-Top Terraces, Fire Pits, Movie Theater, Sun Tanning Salon, Multi-Purpose Game Room, Spa, Indoor Basketball, Wine Cellar, Gift Wrapping Station, Feng Shui Parks, Water Filtration, Planting Garden, Personal Tanning, Bark Parks, Library, Garages, Electric Car Charging Stations, Recycling Service, Valet Trash, Golf Simulators, Co-Working Spaces, Living Green Walls, Putting Green, Life-sized Chessboard,Valet Parking, Indoor Mail Boxes and Mobile Package Service.
All those amenities and the rising cost to maintain them takes a lot $$$. If today’s renters demand all those amenities, then expect to pay big bucks.
While many believe 2020 was a pivotal moment for residential design, some argue it was merely an accelerant. Before March 2020, attributes such as healthy home environments, sustainable qualities, work-from-home capabilities, and unique amenity offerings piqued the interests of many renters, but they weren’t necessarily top needs at the time. Ultimately, the effects of the pandemic pushed those trends to the forefront quickly, and the industry is shifting to accommodate.
To see what’s in store for the coming year, MFE compiled predictions from several industry design experts. Some build upon trend expectations from the past year-plus, including a continued focus on health and wellness and remote work, while others focus on solutions to creating larger units and better outdoor escapes. See below for 10 trends that will influence multifamily design in 2022.
Most of these trends means more money, both in development costs and rent.
While many believe 2020 was a pivotal moment for residential design, some argue it was merely an accelerant. Before March 2020, attributes such as healthy home environments, sustainable qualities, work-from-home capabilities, and unique amenity offerings piqued the interests of many renters, but they weren’t necessarily top needs at the time. Ultimately, the effects of the pandemic pushed those trends to the forefront quickly, and the industry is shifting to accommodate.
To see what’s in store for the coming year, MFE compiled predictions from several industry design experts. Some build upon trend expectations from the past year-plus, including a continued focus on health and wellness and remote work, while others focus on solutions to creating larger units and better outdoor escapes. See below for 10 trends that will influence multifamily design in 2022.
Most of these trends means more money, both in development costs and rent.
I think more and more people will gravitate towards apartment living as housing costs become more expensive in more places with continued increases in building materials costs as well as costs associated with increased regulations relating to things such as flooding or fire impact mitigation as extreme weather events become more common.
With that in mind I feel like the amenities that that article claims will be trends in 2022 should have been trends five years ago. From all 10 of them I was left wondering where the apartment development industry has been and why they're just now realizing that a secure way to receive packages, thoughtful outdoor space, a space to work, and spaces that are not totally bland are things that customers might find attractive.
"Video game violence is not a new problem. Who could forget in the wake of SimCity how children everywhere took up urban planning." - Stephen Colbert
Decent rental market and mortgage survey of the 50 largest cities in the US regarding rising rental rates. Austin topped all in percentile increase in 2021 at nearly 40%. Kansas City is the only only one that saw drop in rental listing price, essentially staying flat.
Omaha ranked No. 13 in a new nationwide look at most competitive rental markets, according to an analysis released Thursday of the first four months of the year by apartment search website RentCafe.com. The researchers looked at the 100 largest U.S. markets and five metrics: average number of days that rentals were vacant; percentage of occupied apartments; pool of prospective renters; lease renewal rates; and new apartments completed compared to the 2021 supply. They used Yardi Systems data from market-rate properties with 50 or more rental units. Fully affordable apartment complexes were excluded.
Job creation, high cost of for-sale homes
Ryan Spellman of Omaha’s Parkway Development says newly created jobs are attracting apartment dwellers to the central Omaha area where he has invested. He also believes high prices of single-family houses are contributing, overall, to longer stays in apartment buildings. That said, he still was a bit surprised at Omaha’s strong showing among the mostly coastal and sunny markets that were identified in the report as most competitive. “It’s definitely a testament to how strong it’s been here,” he said.
Construction on one of the biggest Omaha projects that was issued its green light to build in 2021. Clarity Development’s 12th and Williams Streets. (Cindy Gonzalez/Nebraska Examiner)
To calculate the competitive score, each metric was assigned a weight: average vacant days (15%), occupied
apartments (30%), prospective renters (15%), lease renewal rate (30%), share of new apartments (10%).
Table: RentCafe • Source: Yardi Systems, Inc. • Created with Datawrapper
