Multifamily Housing Predicted to Lead Market in 2011
Lawrence Yun, NAR chief economist, said he anticipates a rise in household formation from an improving economy next year, which will increase demand for housing, both ownership and rental. "Multifamily housing is the one commercial sector that has held on relatively well in the past year, and can expect the best performance in 2011," he added.
"Apartment rents could rise by 1 to 2 percent in 2011, after having fallen in 2009 and no growth in 2010," Yun said. "This rent rise therefore could start to force up broader consumer prices as well."
The apartment rental market - multifamily housing - is expected to get a boost from growth in household formation. Multifamily vacancy rates are forecast to decline from 6.4% in the current quarter to 5.8% in the fourth quarter of 2011.
Areas with the lowest multifamily vacancy rates presently are San Jose, Calif.; Miami; Boston; and Portland, Ore., with vacancies in a range around 4%. Average apartment rent is likely to rise 0.2% this year and another 1.4% in 2011. Multifamily net absorption should be 85,200 units in 59 tracked metro areas this year, and another 147,000 in 2011.
With the popularity of multi-family housing and living arrangements in Hawaii, you might consider an investment in this sector. Contact me for some ideas on multifamily housing in Hawaii Kai.
Barbara Abe, Realtor
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barbara@barbarashawaii.com
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