Sperry Van Ness International Corporation’s (SVNIC) 2014 Top Markets to Watch Reports assess the current state of the national commercial real estate market, and identify micro-trends within specific geographic regions and industries for 2014. Today we are delving into the 2014 Top Apartment Markets to Watch. Not the largest, or the most actively contested markets, the 2014 Apartment Markets to Watch are each at an important juncture that presents unique opportunities for investment. Together, they reflect the diversity of trends that is driving the economy and commercial real estate performance in markets across the country.
TOP APARTMENT MARKET TO WATCH : Houston, Texas
Houston’s multifamily market has been on a two-year high—and lenders are ready to take it down a notch. Construction will add nearly 11,000 units in the Energy City by the end of 2014, more than 6,000 of which will be in a handful of high-end urban submarkets, growing inventory in those neighborhoods by more than 6 percent. With the remaining 5,000 or so units to be completed elsewhere in the city, however, the overall vacancy rate of about 6 percent is unlikely to shift appreciably until 2015 or beyond, and remains low for this market. Houston’s appetite for apartments is growing nearly twice as fast as the pace of construction, which is expected to add 10,000 units annually in 2015 and 2016. Nevertheless, some lenders concerned over the recent volume of development in Houston have tightened underwriting for construction loans, which could create a competitive advantage for investors with other sources of capital.
To read more on Houston, and other top multifamily markets, download the full version of the Top Apartment Markets to Watch report below.
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