Millennials head west for housing, and institutional investors follow

The Mountain States have seen a dramatic rise in apartment building rental income, as bigger real estate firms push into an area once dominated by smaller companies.

National /
Nov.November 29, 2019 11:00 AM
The Mountain States saw the fastest home-price growth of any region (Credit: iStock)

The Mountain States saw the fastest home-price growth of any region (Credit: iStock)

Millennials in search of more affordable digs are heading west, swapping Brooklyn for Boulder. And institutional investors are taking the hint.

Apartment building rental income nearly doubled between 2004 and 2018 in the eight Mountain States, according to a report from Trepp that examined properties in eight states, as cited in the Wall Street Journal. Net operating income grew by 7.33 percent in 2018 in those states of Arizona, Colorado, Idaho, Montana, New Mexico, Nevada, Utah and Wyoming.

The growth rate outstrips any other region in the country, as millennials hunt for cheaper housing, lower taxes and an escape from the city, according to the report.

The growth in a sector that until recently has been dominated by smaller firms has caught the attention of institutional investors. Kennedy Wilson, a publicly-traded real estate investment firm, made its first buy in Salt Lake City in 2012. Since then, it has grown its apartment portfolio to nearly 8,000 units, the Journal reported.

The Mountain States also saw the fastest home-price growth of any region between June 2018 and June 2019, according to the latest quarterly data from the Federal Housing Finance Agency.

The nationwide housing shortage also means people are willing to rent. A March study by the National Low Income Housing Coalition found Idaho had just 48 affordable units for every 100 extremely low-income households. [WSJ] — Georgia Kromrei


Related Articles

arrow_forward_ios
Last year more people relocated to ZIP codes with lower home values and more space. (Getty)
Long-distance movers found cheaper and larger homes in 2020
Long-distance movers found cheaper and larger homes in 2020
(iStock)
Home prices rise for 10th straight month, skyrocketing above 2006 peak
Home prices rise for 10th straight month, skyrocketing above 2006 peak
(iStock)
Institutional buyers are flooding single-family market
Institutional buyers are flooding single-family market
(iStock)
Up, up and away: Home prices soar beyond buyers’ reach
Up, up and away: Home prices soar beyond buyers’ reach
Lenders are being stingy about granting home equity lines of credit. (iStock)
Home values are up, but just try getting a line of credit
Home values are up, but just try getting a line of credit
(iStock)
Hot, hot, hot: Resi market sets new price records in March
Hot, hot, hot: Resi market sets new price records in March
The rate of loans sent to special servicers continued to fall in March. (Unsplash)
CMBS special servicing rate declines in March
CMBS special servicing rate declines in March
Auckland, New Zealand and Shenzhen, China (iStock)
Global luxury home sale prices nudged up in 2020
Global luxury home sale prices nudged up in 2020
arrow_forward_ios

The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

Loading...