Rental Housing Journal Metro
June 2015
3. 6 Keys to Maximize Leasing Results
8. Mind Your Business – Tia’s Tips for Better Rental Management
4. PAROA – 2015 Legislative Update for Property Managers and Investors
9. MFNW – Good Hiring Takes Time, Patience and Practice!
5. Behind the Leasing Desk with Heather Blume
15. Real Estate: What’s In It For Me?
6. RHA Oregon – Continue to Set the Standard
18. Retaining Quality Employees
16. Ask the Secret Shopper 23. Summer Maintenance Checklist
Gen C' Apartments 7. ORHA Legislative Update:
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Published in association with: METRO Multifamily Housing Association; Rental Housing Association of Oregon; IREM & Clark County Rental Association
Apartment Rents Have Nowhere to Go but Up In 2015
Market Overview & Multifamily Housing Update 1Q15 PORTLAND, OREGON
By RED Capital Group Payroll Trends and Forecast The Portland payroll work force continued to expand at a significantly above average pace as establishments hired at a 31,800- job, 3.0% annual rate during the first quarter, up from 4Q’s 28,700-job, 2.7% performance. Accelerated growth was primarily attributable to faster hiring in electronic equipment and semiconductor manufacturing, health care and government, which collectively added 10,200 (3.3%) workers yearon-year, up from 4Q14’s 6.700-job, 2.2% gain. Constructive growth was observed in every industry sector with the exception of colleges and universities, where headcounts fell at 900-job, -6.9% y-o-y rate during 1Q15. The seasonally-adjusted series also recorded vigorous growth, showing an 8,700-job net pick up during the January-March period. Although the advance was moderately slower than 4Q14’s 9,000-job surge, it represented the sixth largest one quarter gain posted since 2000, and second largest of the current recovery. RCR specified a payroll forecasting equation using six lags of the dependent variable and lags of U.S. ...continued on page 12
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By Clifford A. Hockley, President Bluestone & Hockley Real Estate Services
A
s tall tower cranes have become a fixture in the Portland skyline, many are wondering how many units will be added to the Portland metro area in the next few years. According to the spring 2015 Barry Report (published by Patrick and Mark Barry Appraisers) somewhere between 12,000-16,000 units will be built between 2015 and 2016. Typical annual demand is between 3,000 and 4,000 units per year. That translates into a likely surplus of apartment units in 2016.
Given the increased supply, what is forcing rents up? Increased demand for rentals is driven by demographic changes, population growth, and job growth. The low rate of apartment vacancies, at the 3% mark across the Portland Metro marketplace, is evidence of this. Demographic changes. The millennials have exited college, moved out of their parents’ home and are populating central urban areas of major cities. They have created significant apartment demand in the metro Portland area. Note: Developers and investors need to use caution as they continue
to race ahead. Within five years, 50% of this cohort is looking to live in a suburban environment. (According to Trulia‘s chief economist Jed Kilko in a blog he posted on January 22, 2015. Population growth. Since 2010, an estimated 116,168 people have moved to the Portland metropolitan area. This reflects a 5.2% growth rate from 2010–2014, which is the 20th-fastest in the country among large cities in the United States, and fourth-fastest outside the Sun Belt. ...continued on page 17
More Consumers Positive on Housing, But Not Quite Ready to Leave the Sidelines
R
Survey Results Suggest Continued Modest Housing Growth in 2015
esults from Fannie Mae's April 2015 National Housing Survey™ show some improvement in housing sentiment, but likely not enough to trigger any breakout improvements in housing market activity this year. Among those surveyed, the share saying they would prefer to buy a home if they were to move increased to 63 percent in April, following a drop of six percentage points in February and March. In addition, average home
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price growth expectations continued their steady climb from late last year, with respondents now saying home prices will increase by 2.8 percent during the next 12 months. However, the share who believe this is a good time to buy a home decreased by four percentage points as consumer concerns regarding high home prices surged for a second consecutive month, matching renewed concerns regarding the state of the economy. These data points as a whole mirror
Fannie Mae's Home Purchase Sentiment Index (expected to be released this summer), which has remained largely flat since last fall, further suggesting that housing growth may remain subdued in 2015. "The spring and summer home buying season has gotten off to a stronger start, reflected in some of the improvement in consumer housing sentiment," said Doug Duncan, senior vice president and chief econ...continued on page 11
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