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 11:30 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
Lil Wayne and 6480 Allison Road in Miami Beach (Getty Images, Become Legendary/Douglas Elliman Realty)
Lil Wayne lists Miami Beach mansion for $30M
Lil Wayne lists Miami Beach mansion for $30M
South Florida
Home sales fall over 20% in August across South Florida
Home sales fall over 20% in August across South Florida
Ron DeSantis and Peter Thiel (Illustration by The Real Deal with Getty)
Peter Thiel on Florida real estate: “becoming like California”
Peter Thiel on Florida real estate: “becoming like California”
Adrienne Arsht and the Coconut Grove estate (Arsht via Naomi.cherenson, CC BY-SA 4.0, via Wikimedia Commons, 3031 and 3115 Brickell Avenue photos provided by 1 Oak Studios)
Adrienne Arsht’s Coconut Grove estate sells for record $107M
Adrienne Arsht’s Coconut Grove estate sells for record $107M
Miami-Dade County Mayor Daniella Levine Cava (Getty Images)
Unpacking Miami-Dade mayor’s $85M housing affordability kit
Unpacking Miami-Dade mayor’s $85M housing affordability kit
Affiliated Development co-founder Nick Rojo along with 9445 Fontainebleau Boulevard in Miami (left) and the Bohemian apartment project in Lake Worth Beach (right) (Getty Images, Affiliated Development, Google Maps, MSA Architects)
“Slamming on the brakes”: South Florida’s record rent hikes slow
“Slamming on the brakes”: South Florida’s record rent hikes slow
A photo illustration of the Miami skyline (Getty Images)
South Florida home sales plunge in July
South Florida home sales plunge in July
Clockwise from top left: One Sotheby’s Jorge Uribe, Compass' Ida Schwartz, Fortune International Group's Edgardo Defortuna and Royal Palm Companies' Dan Kodsi (Illustration by Kevin Rebong for The Real Deal)
Slowdown hits South Florida’s hot resi market: Here’s what that means
Slowdown hits South Florida’s hot resi market: Here’s what that means
arrow_forward_ios

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

Loading...