Archive for August, 2013

Over Half of US Home Sales All-Cash

The Week magazine quotes a stat reported in the San Francisco Chronicle:

More than half of all U.S. homes sold last year and so far in 2013 were purchased with cash alone. Before the financial crisis, only 20 percent of homes sold were “all-cash sales.” The numbers reflect investors buying cheaper homes in hard-hit areas to rent out. 

This probably doesn’t come as a surprise to anyone competing with the ‘shadow market’ of SFH rentals.

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August 30, 2013 at 1:28 pm Leave a comment

The Parental Shadow Market

An increasing number of folks who would normally be apartment renters are staying home with Ma and Pa:

In a report on the status of families, the Census Bureau on Tuesday said 13.6% of Americans ages 25 to 34 were living with their parents in 2012, up slightly from 13.4% in 2011. Though the trend began before the recession, it accelerated sharply during the downturn. In the early 2000s, about 10% of people in this age group lived at home…

Ms. Tsuong said many of her friends are spending $700 or $800 a month on rent. “I can move out if I really wanted to, but given the situation with rent and gas, I feel like I can save more living at home,” she said. “If you can save now, you’re sort of investing in your future…”

Recent surveys by Pew found over 60% of people ages 18 to 34 knew someone who had moved back in with their parents because of the economy, he said, and that four of five people ages 25 to 34 who were living with their parents were satisfied with the arrangement.

That may suggest there is less stigma attached to living at home, said Mr. Fry. “Living with your parents may not be what it once was,” he said.

Outside of the obvious implications for apartment managers this also has frightening implications for those of us with kids entering their twenties. Here we thought we were crossing the finish line and all of the sudden it’s been moved back ten years!

August 30, 2013 at 12:25 pm Leave a comment

Boone’s Boom in Student Housing

In its July 2013 Student Housing Trends report Axiometrics identified the ten schools that added the largest number of off-campus beds in the United States and Appalachian State University in Boone came in at number 9 with 1,506 beds for the Fall, 2013 semester.

 

August 29, 2013 at 6:13 pm Leave a comment

Too Much Supply in Student Housing

From a story in the 8/28/13 Wall Street Journal:

Some of the millions of students heading back to college—and their parents—are finding a pleasant surprise: Landlords nationwide are cutting rents because of an oversupply of student housing in college towns…

A record 51,000 new off-campus beds are expected to be delivered in college towns nationwide this year, according to Axiometrics Inc. Developer interest in the sector has swelled on the belief that enrollment was outpacing the ability of budget-constrained schools to build or modernize on-campus housing.

But developers appear to have overshot the mark in numerous markets. Some of them failed to take into account other construction that was planned, say experts. Others misjudged future enrollments or the willingness of students to pay up for off-campus living at the time when many families are still pressed in the aftermath of the economic downturn.

With vacancy rates rising due to the new supply, new and existing complexes near schools such as Florida State University, Kennesaw State University in Georgia and Arizona State University are being forced to cut rents to fill beds.

Here at PTAA we’ve been hearing that vacancy rates are up for some local student housing providers, but we don’t have hard data on this semester’s numbers just yet.

August 29, 2013 at 6:02 pm Leave a comment

NAA President Appears on CNBC to Talk Rental Housing

NAA President Doug Culkin appeared on CNBC to talk about the rental housing market in advance of the June Case Shiller Index.

http://video.cnbc.com/gallery/?video=3000194273&play=1

August 27, 2013 at 7:56 pm Leave a comment

Wet Weather Wreaking Havoc on Construction Schedules

The unusually wet summer of 2013 is wreaking havoc on construction schedules in the Piedmont Triad and western NC counties. While projects like BSC Holdings’ Lofts at Little Creek in Winston-Salem have experienced unexpected delays that are unwelcome to the developers, probably the most dramatic impact of these weather delays has been on a student housing project in Boone, NC. From a story in the Winston-Salem Journal:

Alexandra Cramer never thought that she would begin her junior year at Appalachian State University living in a Super 8 Motel.

Cramer is one of about 500 Appalachian students living in hotels because The Cottages of Boone, a student housing complex, is not finished yet…

The Cottages are owned by Capstone Collegiate Communities and will be the largest off-campus housing complex in Boone, designed to house almost 900 students, John Vawter Sr., principal of Capstone, said Tuesday…

“We have been working on this project for over a year and half and nobody is more disappointed that we didn’t deliver than we are,” Vawter said.

He said that the rainy weather caused delays and cost the company millions…

Vawter said he expects the majority of the students in hotels will be moved into The Cottages over the next week and a half, but that a group of students in one building may not have housing for another 60 to 90 days.

August 22, 2013 at 5:48 pm Leave a comment

The End of Student Housing As We Know It?

From an interesting piece in Multifamily Executive about the evolution of the student housing market over the last 20 years:

The latest generation of student housing mirrors the sophistication and diversity of its consumer base.

Every college and university market, demographic base, and site selection context is incredibly varied and the demands of that student population are equally as diverse. Students at an urban liberal arts school with a cost of $52,000 per annum have very different wants, needs, and resources than those at a large suburban state-sponsored engineering and agricultural school…

Those who blindly develop with a “build it and they will come attitude” will suffer like those properties near the University of Denver, or near WVU, or in Minneapolis that only generated 40 percent to 70 percent of projected income in the first year because they did not have specific market knowledge and did not tailor the assets to consumer demands. Targeted development execution with on-the-ground market reconnaissance and due diligence is what will be successful in the coming years.

A developer that builds on a site simply because it is zoned and/or builds what was successful two or three years ago in a different market with a different consumer base will not see the same success, as the student market is the fastest adopting consumer in the housing segment.  The product you are delivering to the marketplace today is becoming obsolete as quickly as the student’s phones, computers, and media.

For those of us old enough to remember student housing options being:

A. Dorm
B. Greek House
C. On-campus apartment
D. Motel converted to apartment
E. Barely standing 60-year-old house converted to student apartments

all of this is a revelation.

August 21, 2013 at 9:03 pm Leave a comment

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