appfolio webinar: another record year?: 2015 mid-year apartment market predictions
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1 2015 © AppFolio, Inc..
Another Record Year?: 2015 Mid-Year Apartment Market Predictions
2 2015 © AppFolio, Inc..
AppFolio
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3 2015 © AppFolio, Inc..
The leader in Apartment Market and Student Housing Research and Analysis
Nick Fitzpatrick, Research Analyst
Sophie Zatterstrom Gore, Research Analyst
14901 Quorum Dr., Suite 600
Dallas, TX 75254
www.axiometrics.com
July 2015
4 2015 © AppFolio, Inc..
The leader in Apartment Market and Student Housing Research and Analysis
• Axiometrics’ sole focus is monitoring the apartment and student housing sectors, thus
pinpointing the market’s true volatility and leading to intelligent – and profitable –
decisions.
• Axiometrics’ superior and timely market research and analytics begin with the floor-plan
analysis of a single property, then extends to competitive properties, submarkets,
metropolitan areas, regions, portfolios and companies.
• Metrics are reported monthly or more frequently, to better depict trends in the markets.
• Our frequent data collection combined with in-depth and intelligent analysis allows to
improve property and portfolio performance, and helps you identify markets, submarkets
and specific sites for apartment and student housing acquisitions and development.
• In addition to the numbers, Axiometrics provides narratives on 120 markets and their
submarkets.
5 2015 © AppFolio, Inc..
Presentation Topics
• Current National Apartment Market Conditions
• Drivers of the Apartment Market
• Individual Market Performance
• New Supply
• Forecast
6 2015 © AppFolio, Inc..
National Year-to-Date Effective Rent Growth
2010
0.0%
1.0%
2.0%
3.0%
4.0%
5.0%
6.0%
7.0%
8.0%
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Source: Axiometrics Inc.
2010
7 2015 © AppFolio, Inc..
National Year-to-Date Effective Rent Growth
2010
2011
0.0%
1.0%
2.0%
3.0%
4.0%
5.0%
6.0%
7.0%
8.0%
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Source: Axiometrics Inc.
2010 2011
8 2015 © AppFolio, Inc..
National Year-to-Date Effective Rent Growth
2010
20112012
0.0%
1.0%
2.0%
3.0%
4.0%
5.0%
6.0%
7.0%
8.0%
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Source: Axiometrics Inc.
2010 2011 2012
9 2015 © AppFolio, Inc..
National Year-to-Date Effective Rent Growth
2010
20112012
2013
0.0%
1.0%
2.0%
3.0%
4.0%
5.0%
6.0%
7.0%
8.0%
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Source: Axiometrics Inc.
2010 2011 2012 2013
10 2015 © AppFolio, Inc..
National Year-to-Date Effective Rent Growth
2010
20112012
2013
2014
0.0%
1.0%
2.0%
3.0%
4.0%
5.0%
6.0%
7.0%
8.0%
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Source: Axiometrics Inc.
2010 2011 2012 2013 2014
11 2015 © AppFolio, Inc..
National Year-to-Date Effective Rent Growth
2010
20112012
2013
20142015
0.0%
1.0%
2.0%
3.0%
4.0%
5.0%
6.0%
7.0%
8.0%
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Source: Axiometrics Inc.
2010 2011 2012 2013 2014 2015
12 2015 © AppFolio, Inc..
Current Apartment Market Conditions
Apartment Market
Performance
Job Growth
Demographics
Single-Family
Affordability
New Supply
13 2015 © AppFolio, Inc..
Polling Question
Of these factors, which are you the most concerned with
moderating apartment performance?
• Single-family Recovery
• Affordability Issues
• New Supply
• Unfavorable Job Growth
14 2015 © AppFolio, Inc..
Current Apartment Market Conditions
Apartment Market
Performance
Job Growth
Outperforms any point last cycle
Demographics
Millennials and lifestyle renters
Single-Family
Current conditions contributing to favorable
apt performance
Affordability
An issue in some of the coastal markets
New Supply
Urban core submarkets are feeling
some effects
Favorable Not Favorable
Condition Scale
15 2015 © AppFolio, Inc..
U.S. Population by Age Group (in Millions)Current population is higher in the 20-34 and 50-64 age groups.
12
14
16
18
20
22
24
20 to 24 Years 25 to 29 Years 30 to 34 Years 35 to 39 Years 40 to 44 Years 45 to 49 Years 50 to 54 Years 55 to 59 Years 60 to 64 Years
Mill
ion
s
2014 Population 2005 Population
Prime Renter Age Group
Sources: Axiometrics Inc., Census
Baby boomers and empty-nesters
16 2015 © AppFolio, Inc..
U.S. Homeownership Rate Remains Below Long-Term Average
61
62
63
64
65
66
67
68
69
70
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
1Q
15
U.S. HO Rate (%) 1990-1Q15 Avg
Sources: Axiometrics Inc., Census
17 2015 © AppFolio, Inc..
New Supply LevelsUnits permitted by year
0
500,000
1,000,000
1,500,000
2,000,000
2,500,000
1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 May2015TTMSources: Axiometrics Inc., Census
Total Residential
18 2015 © AppFolio, Inc..
New Supply LevelsUnits permitted by year
0
500,000
1,000,000
1,500,000
2,000,000
2,500,000
1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 May2015TTMSources: Axiometrics Inc., Census
Total Residential Single-family
19 2015 © AppFolio, Inc..
New Supply LevelsUnits permitted by year
0
500,000
1,000,000
1,500,000
2,000,000
2,500,000
1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 May2015TTMSources: Axiometrics Inc., Census
Total Residential Single-family Multifamily
20 2015 © AppFolio, Inc..
More Residential Construction is NeededAxiometrics projects an average of more than 1.4 million households formed per year through 2018. Total residential
permitting only recently reached the 1 million-unit mark.
0
0.2
0.4
0.6
0.8
1
1.2
1.4
1.6
Current Total Residential Permitting Levels (Trailing 12 Month Sum ofUnits)
Axiometrics Projected Households Formed Per Year (2015-2018)
Mill
ions
Sources: Census, Axiometrics Inc.
21 2015 © AppFolio, Inc..
U.S. Annual Job Growth
-5.5%
-4.5%
-3.5%
-2.5%
-1.5%
-0.5%
0.5%
1.5%
2.5%
3.5%
-6,000
-5,000
-4,000
-3,000
-2,000
-1,000
0
1,000
2,000
3,000
4,00020
00
20
01
20
02
20
03
20
04
20
05
20
06
20
07
20
08
20
09
20
10
20
11
20
12
20
13
20
14
1Q
15
Job Gain ('000) Job Growth (%)
Sources: Axiometrics Inc., BLS
22 2015 © AppFolio, Inc..
U.S. Job and Rent Growth
-5.0%
-4.0%
-3.0%
-2.0%
-1.0%
0.0%
1.0%
2.0%
3.0%
4.0%
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
Job GrowthJob Growth
Sources: Axiometrics Inc., BLS
23 2015 © AppFolio, Inc..
U.S. Job and Rent Growth
-6.0%
-4.0%
-2.0%
0.0%
2.0%
4.0%
6.0%
8.0%
-5.0%
-4.0%
-3.0%
-2.0%
-1.0%
0.0%
1.0%
2.0%
3.0%
4.0%
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
Job Growth Rent Growth Effective
Rent
Growth
Job Growth
Sources: Axiometrics Inc., BLS
24 2015 © AppFolio, Inc..
Polling Question
At the national level, on average, how much more is the
rent on a Class A apartment today, compared to two years
ago?
• ~$50 ($600 over 12 month lease)
• ~$90 ($1,080 over 12 month lease)
• ~$120 ($1,425 over 12 month lease)
25 2015 © AppFolio, Inc..
How Much More Does A Lease Cost Now?June 2013-June 2015 Comparison: Class A(full lease term cost)
$7,174
$6,084
$4,369
$3,609$3,340 $3,242
$2,763 $2,705$2,424 $2,238 $2,128
$1,425 $1,423 $1,314 $1,216 $1,164 $1,077
$604$142
$0
$1,000
$2,000
$3,000
$4,000
$5,000
$6,000
$7,000
$8,000
Source: Axiometrics Inc.
26 2015 © AppFolio, Inc..
How Much More Does A Lease Cost Now?June 2013-June 2015 Comparison: Class B (full lease term cost)
$6,064$5,769 $5,764
$2,916 $2,897$2,607 $2,572
$2,318$1,975 $1,926
$1,658$1,420 $1,391 $1,343 $1,317 $1,306 $1,282 $1,143
$307
$0
$1,000
$2,000
$3,000
$4,000
$5,000
$6,000
$7,000
$8,000
Source: Axiometrics Inc.
Increases higher than Class A
27 2015 © AppFolio, Inc..
How Much More Does A Lease Cost Now?June 2013-June 2015 Comparison: Class C (full lease term cost)
$4,749 $4,577
$3,412
$2,343$1,949
$1,736$1,367
$1,145 $1,137 $1,133 $1,112 $986 $886 $803 $798 $797 $630 $608 $544
$0
$1,000
$2,000
$3,000
$4,000
$5,000
$6,000
$7,000
$8,000
Source: Axiometrics Inc.
28 2015 © AppFolio, Inc..
Rent-to-Income Ratio
0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
50%
Current Long-Term Average
Income based on median household income
Source: Axiometrics Inc., Census
29 2015 © AppFolio, Inc..
Bringing this all back to apartment performance...
30 2015 © AppFolio, Inc..
National Rent Growth and Vacancy Rate
0.0%
1.0%
2.0%
3.0%
4.0%
5.0%
6.0%
4.0%
4.5%
5.0%
5.5%
6.0%
6.5%
7.0%
7.5%
Fe
b-1
1
Ap
r-1
1
Jun
-11
Au
g-1
1
Oct-
11
De
c-1
1
Fe
b-1
2
Ap
r-1
2
Jun
-12
Au
g-1
2
Oct-
12
De
c-1
2
Fe
b-1
3
Ap
r-1
3
Jun
-13
Au
g-1
3
Oct-
13
De
c-1
3
Fe
b-1
4
Ap
r-1
4
Jun
-14
Au
g-1
4
Oct-
14
De
c-1
4
Fe
b-1
5
Ap
r-1
5
Jun
-15
Vacancy (Trailing 12 Month Average) Annual Effective Rent Growth Rent Growth
Source: Axiometrics Inc.
Vacancy
31 2015 © AppFolio, Inc..
National Rent Growth and Vacancy Rate
0.0%
1.0%
2.0%
3.0%
4.0%
5.0%
6.0%
4.0%
4.5%
5.0%
5.5%
6.0%
6.5%
7.0%
7.5%
Fe
b-1
1
Ap
r-1
1
Jun
-11
Au
g-1
1
Oct-
11
De
c-1
1
Fe
b-1
2
Ap
r-1
2
Jun
-12
Au
g-1
2
Oct-
12
De
c-1
2
Fe
b-1
3
Ap
r-1
3
Jun
-13
Au
g-1
3
Oct-
13
De
c-1
3
Fe
b-1
4
Ap
r-1
4
Jun
-14
Au
g-1
4
Oct-
14
De
c-1
4
Fe
b-1
5
Ap
r-1
5
Jun
-15
Vacancy (Trailing 12 Month Average) Annual Effective Rent Growth Rent Growth
Source: Axiometrics Inc.
Vacancy
32 2015 © AppFolio, Inc..
Specific Market Update and Outlook
33 2015 © AppFolio, Inc..
Major Market PerformanceJune 2015 data
MSAAnnual Effective Rent
GrowthMSA
Annual Effective Rent
Growth
Oakland, CA 14.4% San Diego, CA 6.1%
Denver, CO 10.9% Charlotte, NC 6.1%
San Jose, CA 10.4% Raleigh, NC 5.7%
San Francisco, CA 9.1% Anaheim, CA 5.4%
Seattle, WA 7.5% National 5.1%
Atlanta, GA 7.3% Austin, TX 5.0%
Phoenix, AZ 7.1% Boston, MA 4.5%
Nashville, TN 6.8% Chicago, IL 4.2%
Dallas, TX 6.4% New York, NY 3.9%
Orlando, FL 6.3% Houston, TX 3.6%
Fort Lauderdale, FL 6.2% Baltimore, MD 3.2%
Los Angeles, CA 6.2% Washington, DC 1.6%
Tampa, FL 6.2% Silver Spring, MD 1.3%
Source: Axiometrics Inc.
34 2015 © AppFolio, Inc..
Current Rent and Job Growth
Sources: BLS, Axiometrics Inc.
35 2015 © AppFolio, Inc..
Annual Effective Rent Growth – 2Q15
Source: Axiometrics Inc.
36 2015 © AppFolio, Inc..
Polling Question
Where is rent growth stronger now?
• Urban core submarkets
• Suburban submarkets
37 2015 © AppFolio, Inc..
Where is rent growth stronger?
-8.0%
-6.0%
-4.0%
-2.0%
0.0%
2.0%
4.0%
6.0%
8.0%
Ap
r-09
Jun
-09
Au
g-0
9
Oct-
09
Dec-0
9
Fe
b-1
0
Ap
r-10
Jun
-10
Au
g-1
0
Oct-
10
Dec-1
0
Fe
b-1
1
Ap
r-11
Jun
-11
Au
g-1
1
Oct-
11
Dec-1
1
Fe
b-1
2
Ap
r-12
Jun
-12
Au
g-1
2
Oct-
12
De
c-1
2
Fe
b-1
3
Ap
r-13
Jun
-13
Au
g-1
3
Oct-
13
Dec-1
3
Fe
b-1
4
Ap
r-14
Jun
-14
Au
g-1
4
Oct-
14
Dec-1
4
Fe
b-1
5
Ap
r-15
Jun
-15
Source: Axiometrics Inc.
National Effective Rent Growth
Urban Suburban
38 2015 © AppFolio, Inc..
Urban versus SuburbanEffective Rent Growth
Source: Axiometrics Inc.
-15.0%
-10.0%
-5.0%
0.0%
5.0%
10.0%
Jun
-09
Se
p-0
9
Dec-0
9
Ma
r-10
Jun
-10
Se
p-1
0
Dec-1
0
Ma
r-11
Jun
-11
Se
p-1
1
Dec-1
1
Ma
r-12
Jun
-12
Se
p-1
2
Dec-1
2
Ma
r-13
Jun
-13
Se
p-1
3
Dec-1
3
Ma
r-14
Jun
-14
Se
p-1
4
Dec-1
4
Ma
r-15
Jun
-15
Atlanta, GA Urban Suburban
-15.0%
-10.0%
-5.0%
0.0%
5.0%
10.0%
15.0%
Jun
-09
Se
p-0
9
Dec-0
9
Ma
r-10
Jun
-10
Se
p-1
0
Dec-1
0
Ma
r-11
Jun
-11
Se
p-1
1
Dec-1
1
Ma
r-12
Jun
-12
Se
p-1
2
Dec-1
2
Ma
r-13
Jun
-13
Se
p-1
3
Dec-1
3
Ma
r-14
Jun
-14
Se
p-1
4
Dec-1
4
Ma
r-15
Jun
-15
Dallas, TX
-15.0%
-10.0%
-5.0%
0.0%
5.0%
10.0%
15.0%
Jun
-09
Se
p-0
9
Dec-0
9
Ma
r-10
Jun
-10
Se
p-1
0
Dec-1
0
Ma
r-11
Jun
-11
Se
p-1
1
Dec-1
1
Ma
r-12
Jun
-12
Se
p-1
2
Dec-1
2
Ma
r-13
Jun
-13
Se
p-1
3
Dec-1
3
Ma
r-14
Jun
-14
Se
p-1
4
Dec-1
4
Ma
r-15
Jun
-15
Denver, CO
-15.0%
-10.0%
-5.0%
0.0%
5.0%
10.0%
15.0%
Jun
-09
Se
p-0
9
Dec-0
9
Ma
r-10
Jun
-10
Se
p-1
0
Dec-1
0
Ma
r-11
Jun
-11
Se
p-1
1
Dec-1
1
Ma
r-12
Jun
-12
Se
p-1
2
Dec-1
2
Ma
r-13
Jun
-13
Se
p-1
3
Dec-1
3
Ma
r-14
Jun
-14
Se
p-1
4
Dec-1
4
Ma
r-15
Jun
-15
Houston, TX
39 2015 © AppFolio, Inc..
Urban Suburban
Source: Axiometrics Inc.
-15.0%
-10.0%
-5.0%
0.0%
5.0%
10.0%
Jun
-09
Se
p-0
9
Dec-0
9
Ma
r-10
Jun
-10
Se
p-1
0
Dec-1
0
Ma
r-11
Jun
-11
Se
p-1
1
Dec-1
1
Ma
r-12
Jun
-12
Se
p-1
2
Dec-1
2
Ma
r-13
Jun
-13
Se
p-1
3
Dec-1
3
Ma
r-14
Jun
-14
Se
p-1
4
Dec-1
4
Ma
r-15
Jun
-15
San Diego, CA
-5.0%
0.0%
5.0%
10.0%
Jun
-09
Se
p-0
9
Dec-0
9
Ma
r-10
Jun
-10
Se
p-1
0
Dec-1
0
Ma
r-11
Jun
-11
Se
p-1
1
Dec-1
1
Ma
r-12
Jun
-12
Se
p-1
2
Dec-1
2
Ma
r-13
Jun
-13
Se
p-1
3
Dec-1
3
Ma
r-14
Jun
-14
Se
p-1
4
Dec-1
4
Ma
r-15
Jun
-15
Washington, DC
Urban versus SuburbanEffective Rent Growth
-20.0%
-15.0%
-10.0%
-5.0%
0.0%
5.0%
10.0%
15.0%
Jun
-09
Se
p-0
9
Dec-0
9
Ma
r-10
Jun
-10
Se
p-1
0
Dec-1
0
Ma
r-11
Jun
-11
Se
p-1
1
Dec-1
1
Ma
r-12
Jun
-12
Se
p-1
2
Dec-1
2
Ma
r-13
Jun
-13
Se
p-1
3
Dec-1
3
Ma
r-14
Jun
-14
Se
p-1
4
Dec-1
4
Ma
r-15
Jun
-15
Seattle, WA
-15.0%
-10.0%
-5.0%
0.0%
5.0%
10.0%
15.0%
20.0%
25.0%
Jun
-09
Se
p-0
9
Dec-0
9
Ma
r-10
Jun
-10
Se
p-1
0
Dec-1
0
Ma
r-11
Jun
-11
Se
p-1
1
Dec-1
1
Ma
r-12
Jun
-12
Se
p-1
2
Dec-1
2
Ma
r-13
Jun
-13
Se
p-1
3
Dec-1
3
Ma
r-14
Jun
-14
Se
p-1
4
Dec-1
4
Ma
r-15
Jun
-15
Raleigh, NC
40 2015 © AppFolio, Inc..
Polling Question
Which property types are seeing the strongest rent
growth currently?
• Class A (high rents)
• Class B (mid-level rents)
• Class C (low rents)
41 2015 © AppFolio, Inc..
National Asset Class Performance
92.0%
92.5%
93.0%
93.5%
94.0%
94.5%
95.0%
95.5%
96.0%
Dec-1
3
Fe
b-1
4
Ap
r-14
Jun
-14
Au
g-1
4
Oct-
14
Dec-1
4
Fe
b-1
5
Ap
r-15
Jun
-15
Occupancy Rate
0.0%
1.0%
2.0%
3.0%
4.0%
5.0%
6.0%
7.0%
De
c-1
3
Fe
b-1
4
Ap
r-14
Jun
-14
Au
g-1
4
Oct-
14
De
c-1
4
Fe
b-1
5
Ap
r-15
Jun
-15
Annual Effective Rent GrowthA B C
Source: Axiometrics Inc.
42 2015 © AppFolio, Inc..
Asset Class Performance Effective Rent Growth
Source: Axiometrics Inc.
A B C
0.0%
2.0%
4.0%
6.0%
8.0%
10.0%
Dec-1
3
Jan
-14
Fe
b-1
4
Ma
r-14
Ap
r-14
Ma
y-1
4
Jun
-14
Jul-1
4
Au
g-1
4
Se
p-1
4
Oct-
14
Nov-1
4
Dec-1
4
Jan
-15
Fe
b-1
5
Ma
r-15
Ap
r-15
Ma
y-1
5
Jun
-15
Atlanta, GA
0.0%
2.0%
4.0%
6.0%
8.0%
Dec-1
3
Jan
-14
Fe
b-1
4
Ma
r-14
Ap
r-14
Ma
y-1
4
Jun
-14
Jul-1
4
Au
g-1
4
Se
p-1
4
Oct-
14
Nov-1
4
Dec-1
4
Jan
-15
Fe
b-1
5
Ma
r-15
Ap
r-15
Ma
y-1
5
Jun
-15
Dallas, TX
0.0%
2.0%
4.0%
6.0%
8.0%
10.0%
12.0%
14.0%
16.0%
Dec-1
3
Jan
-14
Fe
b-1
4
Ma
r-14
Ap
r-14
Ma
y-1
4
Jun
-14
Jul-1
4
Au
g-1
4
Se
p-1
4
Oct-
14
Nov-1
4
Dec-1
4
Jan
-15
Fe
b-1
5
Ma
r-15
Ap
r-15
Ma
y-1
5
Jun
-15
Denver, CO
-2.0%
0.0%
2.0%
4.0%
6.0%
8.0%
10.0%
12.0%
Dec-1
3
Jan
-14
Fe
b-1
4
Ma
r-14
Ap
r-14
Ma
y-1
4
Jun
-14
Jul-1
4
Au
g-1
4
Se
p-1
4
Oct-
14
Nov-1
4
Dec-1
4
Jan
-15
Fe
b-1
5
Ma
r-15
Ap
r-15
Ma
y-1
5
Jun
-15
Houston, TX
43 2015 © AppFolio, Inc..
Asset Class Performance Effective Rent Growth
Source: Axiometrics Inc.
A B C
-2.0%
0.0%
2.0%
4.0%
6.0%
8.0%
Dec-1
3
Jan
-14
Fe
b-1
4
Ma
r-14
Ap
r-14
Ma
y-1
4
Jun
-14
Jul-1
4
Au
g-1
4
Se
p-1
4
Oct-
14
Nov-1
4
Dec-1
4
Jan
-15
Fe
b-1
5
Ma
r-15
Ap
r-15
Ma
y-1
5
Jun
-15
Raleigh, NC
2.0%
4.0%
6.0%
8.0%
Dec-1
3
Jan
-14
Fe
b-1
4
Ma
r-14
Ap
r-14
Ma
y-1
4
Jun
-14
Jul-1
4
Au
g-1
4
Se
p-1
4
Oct-
14
Nov-1
4
Dec-1
4
Jan
-15
Fe
b-1
5
Ma
r-15
Ap
r-15
Ma
y-1
5
Jun
-15
San Diego, CA
4.0%
6.0%
8.0%
10.0%
Dec-1
3
Jan
-14
Fe
b-1
4
Ma
r-14
Ap
r-14
Ma
y-1
4
Jun
-14
Jul-1
4
Au
g-1
4
Se
p-1
4
Oct-
14
Nov-1
4
Dec-1
4
Jan
-15
Fe
b-1
5
Ma
r-15
Ap
r-15
Ma
y-1
5
Jun
-15
Seattle, WA
-5.0%
-3.0%
-1.0%
1.0%
3.0%
5.0%
Dec-1
3
Jan
-14
Fe
b-1
4
Ma
r-14
Ap
r-14
Ma
y-1
4
Jun
-14
Jul-1
4
Au
g-1
4
Se
p-1
4
Oct-
14
Nov-1
4
Dec-1
4
Jan
-15
Fe
b-1
5
Ma
r-15
Ap
r-15
Ma
y-1
5
Jun
-15
Washington, DC
44 2015 © AppFolio, Inc..
Top 10 MSAs for Apartment Deliveries in 2015
*Delivery schedule is only based on identified properties that have started construction. The 2016 totals will be higher for most MSAs as planned
properties begin construction. The schedule is dynamic and changes as construction timelines change on individual properties.
The chart is based on data as of June 2015.
Source: Axiometrics Inc.
MSA 2013 2014 2015 2016*
Houston, TX 8,100 14,170 18,150 7,646
Dallas, TX 9,926 11,860 15,365 9,787
Washington, DC 7,787 11,319 11,575 5,592
New York, NY 6,076 8,158 10,743 17,402
Denver, CO 4,220 6,116 9,913 4,045
Seattle, WA 6,107 8,409 9,008 6.296
Atlanta, GA 3,918 5,624 8,859 4,208
Austin, TX 5,656 7,968 8,654 4,621
Los Angeles, CA 3,282 6,595 7,546 8,746
Charlotte, NC 2,928 5,509 7,098 1,787
National 165,779 219,753 285,326 145,640
45 2015 © AppFolio, Inc..
Top 15 Submarkets for Deliveries in 2015Identified Deliveries By Year
MSA Submarket 2013 2014 2015 2016*
Houston, TX Montrose/River Oaks 2,958 4,755 4,955 3,248
Atlanta, GA Atlanta/Fulton 1,183 3,818 4,533 3,132
Dallas, TX Oaklawn 1,130 2,845 3,048 1,793
Seattle, WA Downtown/Capitol Hill/Queen Anne 2,954 3,463 2,833 1,917
Denver, CO Denver-Downtown 1,474 1,271 2,694 1,805
Silver Spring, MD Rockville 34 1,124 2,122 284
Houston, TX Far NW/Montgomery County 421 2,884 2,052 350
New York, NY Hudson Waterfront 194 669 2,012 3,191
San Jose, CA Northeast San Jose 2,594 1,763 2,005 1,203
New York, NY Kings County 822 1,284 1,973 4,556
Houston, TX Bear Creek/Katy 928 1,578 1,906 545
Los Angeles, CA Marina Del Rey/Venice/Westchester 788 893 1,814 729
Raleigh, NC Central Raleigh 704 559 1,805 543
Houston, TX Ft. Bend County 527 696 1,760 0
*Delivery schedule is only based on identified properties that have started construction. The 2016 totals will be higher for most MSAs as planned
properties begin construction. The schedule is dynamic and changes as construction timelines change on individual properties.
The chart is based on data as of June 2015.
Source: Axiometrics Inc.
46 2015 © AppFolio, Inc..
Houston, TX
0.0%
1.0%
2.0%
3.0%
4.0%
5.0%
-
5,000
10,000
15,000
20,000
201
0
201
1
201
2
201
3
201
4
201
5F
201
6F
201
7F
201
8F
Job G
row
th
Apart
ment
Units
New Multifamily Supply Demand/Absorption Job Growth
Sources: BLS, Census, Axiometrics Inc.
-4.0%
-2.0%
0.0%
2.0%
4.0%
6.0%
8.0%
87.0%
88.0%
89.0%
90.0%
91.0%
92.0%
93.0%
94.0%
95.0%
96.0%
2010 2011 2012 2013 2014 2015F 2016F 2017F 2018F
Occupancy Rate Effective Rent Growth
47 2015 © AppFolio, Inc..
Dallas, TX
0.0%0.5%1.0%1.5%2.0%2.5%3.0%3.5%4.0%4.5%
- 2,000 4,000 6,000 8,000
10,000 12,000 14,000 16,000 18,000
201
0
201
1
201
2
201
3
201
4
201
5F
201
6F
201
7F
201
8F
Job G
row
th
Apart
ment
Units
New Multifamily Supply Demand/Absorption Job Growth
Sources: BLS, Census, Axiometrics Inc.
-2.0%-1.0%0.0%1.0%2.0%3.0%4.0%5.0%6.0%7.0%8.0%
89.0%
90.0%
91.0%
92.0%
93.0%
94.0%
95.0%
2010 2011 2012 2013 2014 2015F 2016F 2017F 2018F
Occupancy Rate Effective Rent Growth
48 2015 © AppFolio, Inc..
Washington, DC
94.0%
94.5%
95.0%
95.5%
96.0%
96.5%
-1.0%
0.0%
1.0%
2.0%
3.0%
4.0%
5.0%
6.0%
201
0
201
1
201
2
201
3
201
4
201
5F
201
6F
201
7F
201
8F
Occupancy Rate Effective Rent Growth
Sources: BLS, Census, Axiometrics Inc.
0.0%
0.5%
1.0%
1.5%
2.0%
2.5%
(5,000)
-
5,000
10,000
15,000
20,000
201
0
201
1
201
2
201
3
201
4
201
5F
201
6F
201
7F
201
8F
Job G
row
th
Apart
ment
Units
New Multifamily Supply Demand/Absorption Job Growth
49 2015 © AppFolio, Inc..
San Francisco, CA
0.0%
2.0%
4.0%
6.0%
8.0%
10.0%
12.0%
14.0%
94.6%
94.8%
95.0%
95.2%
95.4%
95.6%
95.8%
96.0%
96.2%
96.4%
2010 2011 2012 2013 2014 2015F 2016F 2017F 2018F
Occupancy Rate Effective Rent Growth
Sources: BLS, Census, Axiometrics Inc.
0.0%
1.0%
2.0%
3.0%
4.0%
5.0%
6.0%
(2,000)
-
2,000
4,000
6,000
8,000
201
0
201
1
201
2
201
3
201
4
201
5F
201
6F
201
7F
201
8F
Job G
row
th
Apart
ment
Units
New Multifamily Supply Demand/Absorption Job Growth
50 2015 © AppFolio, Inc..
Seattle, WA
-1.0%
0.0%
1.0%
2.0%
3.0%
4.0%
5.0%
6.0%
7.0%
8.0%
94.2%
94.4%
94.6%
94.8%
95.0%
95.2%
95.4%
95.6%
95.8%
2010 2011 2012 2013 2014 2015F 2016F 2017F 2018F
Occupancy Rate Effective Rent Growth
Sources: BLS, Census, Axiometrics Inc.
0.0%
0.5%
1.0%
1.5%
2.0%
2.5%
3.0%
3.5%
-
2,000
4,000
6,000
8,000
10,000
201
0
201
1
201
2
201
3
201
4
201
5F
201
6F
201
7F
201
8F
Job G
row
th
Apart
ment
Units
New Multifamily Supply Demand/Absorption Job Growth
51 2015 © AppFolio, Inc..
Current Rent and Job Growth
Sources: BLS, Axiometrics Inc.
52 2015 © AppFolio, Inc..
Current Rent and Job Growth
Sources: BLS, Axiometrics Inc.
53 2015 © AppFolio, Inc..
Current Rent and Job Growth
Sources: BLS, Axiometrics Inc.
54 2015 © AppFolio, Inc..
Current Rent and Job Growth
Sources: BLS, Axiometrics Inc.
55 2015 © AppFolio, Inc..
2016-2018 Forecast Rent and Job Growth
Sources: BLS, Axiometrics Inc.
56 2015 © AppFolio, Inc..
2015 Forecast
372,266
4.3%
2.1%
-6.0%
-4.0%
-2.0%
0.0%
2.0%
4.0%
6.0%
0
50,000
100,000
150,000
200,000
250,000
300,000
350,000
400,000
1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015F
Units
Sources: Census, Axiometrics Inc.
New Multifamily Supply Annual Effective Rent Growth Job Growth
57 2015 © AppFolio, Inc..
National Occupancy and Effective Rent Growth
-6.0%
-4.0%
-2.0%
0.0%
2.0%
4.0%
6.0%
90.0%
91.0%
92.0%
93.0%
94.0%
95.0%
96.0%
19
98
19
99
20
00
20
01
20
02
20
03
20
04
20
05
20
06
20
07
20
08
20
09
20
10
20
11
20
12
20
13
20
14
20
15F
20
16F
20
17F
20
18F
20
19F
20
20F
Source: Axiometrics Inc.
Occupancy Rate Effective Rent Growth
Averages from 2010-2014
Annual Rent Growth: 3.3%
Occupancy Rate: 94.1%.
Forecast average for 2016-2018
Annual Rent Growth: 3.6%
Occupancy Rate: 94.8%.
Forecast average 2016-2020
Annual Rent Growth: 3.5%
Occupancy Rate: 94.7%.
58 2015 © AppFolio, Inc..
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59 2015 © AppFolio, Inc..
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