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Carl Whitaker is a Market Analyst for RealPage, Inc., where he blends in his passions for geography and teaching to foster a practical, applied understanding of apartment data and analysis. He specializes in creating in-depth reports and presentations to allow for easier consumption and application of data and analysis. Prior to joining RealPage, Carl was a Market Analyst for Axiometrics and an analyst for Catalyst Commercial, a Dallas-based economic development solutions firm.
In this Peak Market Watch episode, Carl Whitaker, the Director of Research & Analysis, RealPage - Nationwide market intelligence for multifamily owners and investors, joins Peak Market Watch host and CEO of Peak Financing, Anton Mattli, and Disrupt Equity Principal and co-host, Ben Suttles, as he shares an incredible multifamily market analysis on where we are at today and what the projections are for the rest of 2022 and beyond.
Here are a few highlights on what he will cover in this episode of Peak Market Watch:
- Nationally, multifamily unit absorption in 2021 was 60% greater than the previous annual peak dating back to the 1990s!
- COVID-19 certainly caused the pent-up demand in 2021.
- Trade-outs: New leases in January 2022 were up 18% from expiring lease & renewals were up 10-11%!
- Record rent growth was a combination of a catch-up from no to little increases in 2020, jump in demand, as well as inflationary pressures
- Rent growth is expected to continue in 2022 but not at 2021 levels
- Multifamily permitting did not reach pre-Great Recession levels until 2014
- Affordability A Class properties: Rent to income ratio is typically in the upper teens %
- Affordability B Class properties: Rent to income ratio is typically in the lower 20s %
- Affordability C Class properties: Rent to income ratio is still just at around 27-28%
- In summary, at a broad level, affordability is still not a significant issue at investment grade/professionally managed properties despite significant rent increases
- Delinquencies: Even during the depths of the 2020 downturn, collections were down by just 3% compared to pre-pandemic levels whereas Class C assets showed more challenges, particularly in markets that implemented renter protections.
- No expectation of an eviction "tsunami"
- Expense pressure has been very strong, particularly due to increases in payroll, insurance premiums, and property taxes
- Tight and innovative asset and property management will be crucial to keep expenses at bay - technology solutions are key to cut costs without cutting service quality
- Loss-to-lease: Still a good amount of runway to increase rents, particularly in certain sunbelt markets with record low vacancies such as Florida
- Sunbelt markets: There is an increased interest to rent in urban areas but that does not come at the expense of suburban markets - the demand is still so strong that both suburbs and urban centers in the sunbelt markets are benefitting for such demand
- Large Markets you should be watching: Raleigh Durham, NC - Mid-size market: Cape Coral, FL - Small market: Ashville, NC
Connect with Anton Mattli
CEO of PEAK Financing
anton@peakfinancing.com
https://peakfinancing.com/
Connect with Ben Suttles
Principal, Disrupt Equity
ben@disruptequity.com
https://www.disruptequity.com/
Connect with Carl Whitaker
Director of Research & Analysis, RealPage
carl.whitaker@realpage.com
http://www.realpage.com/
