Valley Rental Housing Journal - June 2015

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June 2015

Rental Housing Journal Valley 2. Behind the Leasing Desk with Heather Blume 3. Good Hiring Takes Time, Patience and Practice! 6. Ask the Secret Shopper

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6 Keys to Maximize Leasing Results By Tami Cox

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n a competitive leasing market, it's important to stay on top of your game if you want to minimize vacancy rates. Regardless of whether you are new to leasing or have been doing it for years, try these proven strategies to gain better results from your leasing efforts on multi-family properties: 1. Know your market - When was the last time you not just pulled rental comps, but actually visited properties in the direct vicinity of the property to be leased? Do you know what the "other" guys units look like? What a prospective tenant is getting for their money? Are your rents in line with the current market for the same bedroom/bathroom configuration and square footage? How friendly is the leasing staff out there? Are your competitor's buildings well maintained or going downhill fast? How can you lease what you have if you never leave your desk when doing your "market research"? This may seem time intensive and tedious. But even a day or two spent on such activities will be worth it. 2. Be responsive to leads - I don't know about you, but one of the most irritating things as a person looking for a new place to call home is if you reach out to a place you're interested in, and they don't call you back! I consider this to be unprofessional, and surprisingly, there are a lot of these property managers and leasing agents out there. Maybe they don't care about leasing their units? Maybe they have so much money to throw continued on page 5 Professional Publishing, Inc PO Box 30327 Portland, OR 97294-3327

Apartment Rents Have Nowhere to Go but Up In 2015 By Clifford A. Hockley, President Bluestone & Hockley Real Estate Services

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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. Job Growth. ...continued on page 7

More Consumers Positive on Housing, But Not Quite Ready to Leave the Sidelines

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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 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

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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 economist at Fannie Mae. "The share of consumers who intend to own rather

than rent their next home rebounded after a two-month slide. Meanwhile, home price growth expectations strengthened to the strongest pace since last October. Nevertheless, consumers continue to express concerns about the recent weakening economic conditions and high home prices. These combine to depress the share of consumers believing it is a good time to buy a home. When we consider both the continued caution of consumers and the positive start to the year, we believe that these results support our expectation that 2015 will be a year of modest growth in housing activity."

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