| A second report, in as many days, about apartment market jitters says too many unsold condos could gum up the works my mid-year in what was considered a hot rental market. On January 18, RealFacts said the apartment market had been going great guns until landlords shot themselves in the foot by raising rents too quickly. RealFacts.com said renters’ backlash, rather than seasonal factors, in the last quarter of 2006 produced unexpectedly high occupancy rate dips in every one of the nearly three dozen metros it tracks in 15 states. The next day a National Association of Homebuilders Washington Hotline newsletter carried the headline “New Multifamily Data Forecasts A Bumpier 2007.” |
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The apartment market got a boost last year from the high-priced housing market which forced shelter seekers into more affordable apartments and rental rates took off with the demand. In NAHB’s preliminary forecast, due in full at the Multifamily Economic Forecast & State of the Industry session during the International Builders Show on Feb. 8, recounts how demand for rental apartments slowed even before RealFacts’ fourth quarter report. Ron Witten, industry analyst, who briefed NAHB s Multifamily Leadership Board, said demand for rental apartments slowed substantially in the third quarter of 2006, “in part, because a slowdown in job growth slowed the formation of new households.” Witten blamed sluggish job growth, accompanied by falling mortgage rates, for contributing to the lower demand for rentals.
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