Axiometrics: June Apartment Market Data Softens Slightly

12101_apartments Axiometrics: June Apartment Market Data Softens Slightly The majority of U.S. apartment markets appear to have moderated from their peak effective rent growth levels recorded last summer, according to new data from Dallas-based Axiometrics Inc.

Axiometrics reports that the national sequential effective rent growth from May to June was 0.52%, as compared to 0.76% in the same period of 2011. San Francisco led the country with annual effective rent growth rates approaching 19% for Class A properties.Â

However, the company stresses that this year could be the third consecutive year that the national apartment market posts effective rent growth of 4% or more. One encouraging sign, according to Axiometrics, involves real estate investment trust properties, which comprise approximately 12% of the Axiometrics database – this sector showed stronger year-to-date effective rent growth than other properties, with a current average rate of 6.08% versus 5.68% over the same period in 2011.

‘We will soon know if this is just a one-month blip or if it looks like there will be further softening in the second half of the year, though by historical standards we are still in a strong effective rent growth market,’ says Jay Denton, vice president of research for Axiometrics. ‘Multiple scenarios could play out over the coming months, leading to end-of-year growth rates anywhere from just under 4 percent to as high as 4.7 percent. Much depends on job growth, as well as on new unit deliveries, which are really starting to ramp up.’


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