US – March 2013 Multifamily Permit Stats

For the U.S., March 2013 Multifamily Permitting Approaching Long Term Average  

The U.S. Census Bureau posted its March national residential permitting numbers on April 16. Privately-owned housing units authorized by building permit in March, measured on a seasonally adjusted annual rate (SAAR), were 902,000. This was a decrease of 3.9% from the revised February rate of 939,000, but was 17.3% above the March 2012 estimate of 769,000.

During March 2013, annual multifamily (MF) permits increased by 24.7% at the national level from the comparable period a year ago. With the March 2013 MF permit number at 283,000 units, annual MF permitting has now been above 200,000 for 17 consecutive months. The anticipation of moderating but still healthy apartment market fundamentals over the next two years and stable long-term demographics and economic outlook is stimulating developers and investors to start new projects. Even with the first waves of permits during this upward cycle being turned into completions this year, completions will still remain slightly below the long-term historical average for the U.S. and most metropolitan statistical areas (MSAs). By 2014, most MSAs will see their inventory growth pass the historical average. However, there are some MSAs like Charleston; Raleigh; Washington, DC; Baltimore; Austin; Nashville; Philadelphia; and Seattle, where new supply will outpace the historical average rate this year.   (March 2013 permitting numbers by metropolitan area will be released on April 24, 2013.)

US – Home Price Up in 90 Percent of U.S. Cities

A dwindling supply of lower-priced homes and foreclosures continued to fuel the upward trend in home prices, an industry report showed Monday, with property values posting the strongest year-over-year increase in seven years. 

2013 Feb – Greater Vancouver Real Estate Market

MLS® home sales in the region were the second-lowest total for February in 12 years, and 30.9 per cent below the 10-year average. Compared to last February, home sales were down 29.4 per cent.

Detached houses were the least favoured. House sales were down 36.1 per cent from February 2012, while apartments declined 25.5 per cent and townhouses, 21.5 per cent. All housing types saw higher sales in February than January, with townhouse sales increasing the most, but sales always increase as we head into spring.

US – Rise of Renter Class Drives Construction Activity

FORTUNE —  Renters (as opposed to buyers) are still driving the rebound of the residential construction industry.

Construction of single-family homes rose to a nearly five-year high in February, the Commerce Department reported. Single-family home building, which made up about 66% of housing starts last month, rose 0.5% to a rate of 618,000 units — the highest level since June 2008. This follows a 31.5% rise in single-family construction in the last year.

Although this might suggest buyers are driving home building again, renters are still playing an unusually large role in the home construction industry — a trend that’s lasted since 2007 when the housing market collapsed. Construction of multi-family homes, typically destined for the rental market, make up about 33% of all residential construction today. That’s markedly higher than the average of nearly 20% over the past two decades.

US – NAR: Rental, For-Sale Markets Rise Together

The apartment and for-sale housing markets usually compete with each other.  But what’s happening today is different, according to the economists at the National Association of Realtors (NAR). “Rental demand and housing sales are rising at the same time,” says NAR spokesperson Walter Maloney.

What’s behind the seeming contradiction?  The number of households is growing again after years of lagging behind the growth in the population. For years, graduates have been moving back home or sharing dwellings with roommates. Now, more people are striking out on their own.  And this formation of new households is creating strong demand for both rental and for-sale housing.

Lots of demand

The for-sale housing market is recovering faster than seemed possible just last year. Many economists expected for-sale home prices to drop in 2012, such as the analysts at Freddie Mac. Instead prices rose more than 7 percent, according to indexes kept by both Case Shiller and the Federal Housing Administration. The number of sales is also rising quickly, despite the small number of homes on the market.

US – NAHB: Multifamily Continues to Grow in 2013

After years of downturn, home building is now solidly contributing to economic growth. An important factor behind that growth has been the expansion of multifamily construction such as apartment buildings and condominiums.

As a result of the housing crisis, homeownership is down, particularly among younger households. In addition, the overall number of households—homeowners and renters combined—is down compared to where it should be given the population growth.

This trend has translated into a lot of potential in household formation—as many as two million future households according to some estimates, with most of them expected to become renters as economic and labor market conditions improve.

The result for the building industry has been an increase in the demand for rental units, which in turn has reduced rental vacancy rates and driven demand for multifamily construction.

US – How Long Can Multifamily Boom Last?

Home starts of structures with five or more units, which rose 56% and 38% respectively in the past two years, are expected to be up again, by 22% to 299,000 units, in 2013, according to NAHB estimates. But several builders in the audience of a seminar at which the association presented its projections during the International Builders’ Show last Thursday openly challenged NAHB’s 2013 and 2014 forecasts as being too low and not adequately reflecting what they saw as the increasing share of total starts that rental properties are likely to capture.

US – Home Construction Boom Led By Apartment Demand

Total housing starts rose 12% vs. November to an annualized 954,000, the Commerce Department reported. That’s the most in 4-1/2 years and far above the 887,000 expected. Construction on housing with five or more units shot up 23%. Single-family starts were up 8%.

The strong construction figures and a five-year low in jobless claims helped push the S&P 500 to a fresh five-year high. That’s despite a weak report on mid-Atlantic manufacturing.

US – Top 25 Metros Home Price Growth vs. Rent Growth

Earlier today, Trulia released the latest data for its November 2012 Trulia Rent Monitor. Rents were up nationally 5.6 percent year-over-year in November, compared to asking prices on for-sale homes increasing 5.4 percent over the same period.

But out of the Top 25 metros included in Trulia data, only 11 saw rents increase at a higher rate than asking home prices.

Metro Area (MSA)	Nov. 2012 Y-o-Y Rent Change	Nov. 2012 Y-o-Y Asking Price Change
Houston	16.8%	2.3%
Oakland	11.6%	10.5%
Miami	10.8%	7.6%
Denver	9.0%	12.4%
Philadelphia	8.9%	-0.8%
Seattle	8.3%	8.8%
Minneapolis	7.8%	7.1%
Chicago	6.9%	-3.1%
New York, NY	6.6%	0.3%
San Francisco	5.8%	9.5%
Boston	5.7%	3.2%
Portland, Ore.	5.1%	6.7%
Los Angeles	5.1%	2.8%
Atlanta	5.0%	6.0%
Baltimore	4.7%	1.2%
Dallas	4.4%	0.8%
Inland Empire, Calif.	4.1%	9.1%
Tampa/ St. Petersburg, Fla.	3.4%	7.4%
Orange County, Calif.	3.2%	7.7%
San Diego	2.8%	5.4%
Washington, D.C.	2.6%	6.4%
Phoenix	2.3%	26.9%
St. Louis	1.2%	1.7%
Sacramento	1.2%	5.0%
Las Vegas	-0.7%	13.7%

Source: MFE

US – 10 Best Markets for Single-Family Housing in 2013

Don’t call it a comeback. But the housing market is seeing an improvement in fundamentals across the nation thanks to growing employment rates, low vacancy rates, and low foreclosure inventory.

The latest data from Trulia suggests that several major metros will have a strong year when it comes to home sales.

But no need to fret, there is room at the table for everyone. Rents continue to outpace home price gains nationally. Rents rose 5.6 percent in November compared to the previous year, outpacing the national price gain of 3.8 percent, according to Trulia.

And in some markets, rent and for-sale gains are simultaneously strong: Houston, for instance,  had year-over-year rent increases of 16.8 percent in November, and also leads the list of most promising for-sale markets.

Here are the 10 cities that Trulia predicts will have a strong year in 2013 for single-family home sales. Adjust your strategy accordingly. (Spoiler alert—Texas is still king).

1.       Houston, Texas
2.       San Francisco, Calif.
3.       Bethesda-Rockville-Fredrick, Md.
4.       San Antonio, Texas
5.       Austin, Texas
6.       Seattle, Wash.
7.       Omaha, Neb.
8.       Peabody, Mass.
9.       Fort Worth, Texas
10.     Louisville, Ky.

Source: MFE