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 10:00 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
Fewer homes are selling across Southern California, but low supply helped push pricing up across the region.
Far fewer SoCal homes traded in April, but prices rose
Far fewer SoCal homes traded in April, but prices rose
Scott Laurie, chief executive of Olson Co. and Christopher Thornberg, founding partner of Beacon Economics
How slow can you go? Statewide homebuilders tap brakes on new projects amid rising costs
How slow can you go? Statewide homebuilders tap brakes on new projects amid rising costs
CoreLogic analyst Andrew LePage
LA home sale prices just set another record high
LA home sale prices just set another record high
John Burns (Credit: iStock)
As mortgage rates fall, 250K more SoCal households can afford starter homes
As mortgage rates fall, 250K more SoCal households can afford starter homes
Southland Regional Association of Realtors President Dan Tresierras and the San Fernando Valley (Credit: Wikipedia)
San Fernando Valley might be selling homes slowly, but prices just won’t stop rising
San Fernando Valley might be selling homes slowly, but prices just won’t stop rising
CoreLogic Research Analyst Andrew LePage
Peak LA: Home prices tie all-time high, but fewer properties sell
Peak LA: Home prices tie all-time high, but fewer properties sell
Andy Reid, the President of MetroStudy
The great SoCal slowdown: Homebuilding drops 18%
The great SoCal slowdown: Homebuilding drops 18%
Reports on Housing founder Steven Thomas
Homes flood the SoCal market, but buyers aren’t biting
Homes flood the SoCal market, but buyers aren’t biting
arrow_forward_ios

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

Loading...