The Real Deal New York

Apartment occupancy reaches 95 percent nationwide

Vacancies are at a six year low
June 22, 2014 04:00PM

 National apartment occupancy in May reached its highest level in six years, according to Axiometrics, an apartment data and research company. Across the U.S., 95 percent of all units are filled, even as multi-family construction booms.

“It’s a pleasant surprise because it’s coming at a time when new supply is flooding the market,” Stephanie McCleskey, Axiometrics’ director of research, told CNBC. “One reason occupancy is rising is that, not only are people moving into these new units, but they’re also moving into Class B units at a lower price point.”

The success of the multi-family sector has come as a surprise to some investors, who pulled out of multifamily REITs last year, to focus on surging home sales, according to CNBC. The S&P index of residential REITs is now up nearly 14 percent from a year ago and up nearly 20 percent year-to-date.

“The rent-buy math remains generally favorable for our apartment coverage universe,” according to report from Deutsche Bank. “Though pending supply remains a concern for certain apartment markets in 2014 and 2015, recent revenue growth trends were better-than-expected suggesting that strong demand, buoyed by improving rent-buy dynamics, is helping to offset increases in supply.” [CNBC]Christopher Cameron