APARTMENT SUPPLY BEGINING TO IMPACT MARKET FUNDAMENTALS (source CoStar)

Ripples from Apartment Supply Wave Beginning to Impact Market Fundamentals

Vacancy Rate Expected to Rise Another 50 Basis Points By End of 2014, According to CoStar Forecast
September 3, 2014
New apartment completions and construction starts continue to trend upward, and the new supply of units is beginning to show up in rising vacancy rates in a number of high-growth U.S. markets.

Multifamily construction increased 8% in July, continuing a yearlong upward trend, with several large new projects starting last month, including a $350 million multifamily tower in Queens, NY; a $260 million condominium tower in Honolulu and the $160 million residential portion of the $300 million mixed-use building in Los Angeles.

According to U.S. Census Bureau numbers released this week, multifamily spending in the residential sector increased a slender 0.2% between June and July, rising from $43.2 billion to $43.3 billion. But the most significant story is the year-over-year comparison: spending improved 41% from July 2013.

New York City, Washington D.C., Los Angeles, Miami and Boston remained the top five metropolitan areas ranked by the dollar volume of new multifamily starts through the first seven months of 2014.

The apartment-building boom will continue through at least next year, according to an early survey of CRE executives’ sentiments for 2015.

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source: http://www.costar.com/News/Article/Ripples-from-Apartment-Supply-Wave-Beginning-to-Impact-Market-Fundamentals/163534?ref=/News/Article/Ripples-from-Apartment-Supply-Wave-Beginning-to-Impact-Market-Fundamentals/163534&src=rss
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