Employment growth among Americans in their 20's that spanned between May 2010 and May of this year helped spur the strongest apartment demand observed in a generation, according to a new report.
However, RED CAPITAL GROUP LLC's ‘Multifamily Housing Industry 2011 Mid-Year Review and Second Half Outlook Report’ observes, substantial winter and spring gains morphed into year-on-year losses in the summer that pose a potential threat to an apartment-sector recovery.
According to the report, 21 of the 50 markets monitored by RED posted higher absorption in the second quarter than the first. Fifteen of the markets, including institutional-investor favorites such as Boston and San Francisco, registered at least a 40% sequential quarter unit absorption decline.
The report also finds that export-driven manufacturing revivals fueled stronger-than-expected hiring in corners of the Heartland, such as Nashville, Tenn.; Pittsburgh; Columbus, Ohio; Louisville, Ky.; and St. Louis. Also, high-tech hubs – e.g., San Jose, Calif., and Seattle – and Texas metro areas – Dallas, Fort Worth, Houston and Austin – posted the strongest job growth in the spring. Milwaukee led the nation in year-over-year job growth, RED says.
Authored by RED researchers Daniel J. Hogan and Joseph M. Mandeville, the report is available for download, with registration, on the company's website.