US Apartment Market is Predicted to Worsen in Q4 2009
According to the forecast, rental demand for apartments, as measured by the occupied stock, is predicted to decline in Q4 2009 by 44,720 units (negative net absorption), reversing the trend of increasing occupied stock and a slightly declining vacancy rate that was registered in Q3 2009. Note that in Q3 2009 the occupied stock increased by 58,362 units (positive net absorption). Despite the predicted drop in demand in Q4, total net absorption for 2009 is predicted to be positive and amount to 50,145 units.
With declining demand and rising supply the US apartment vacancy rate is predicted to increase from 7.3% in Q3 2009 to 7.8% in Q4, pushing the average for the year up to 7.3%, which will represent a 160 basis point increase compared to the 2008 average apartment vacancy rate of 5.7%. The weakening apartment market in Q4 2009 is expected to have a negative effect on rents, which are predicted to drop by 1%, bringing the total annual decline in 2009 to 4.1%.
The US apartment market is predicted to continue to deteriorate in 2010 with the national vacancy rate rising further to 7.6% and apartment rents declining by an additional 3.3%. If you have an interesting comment in relation to this article please use the form below Related Posts to submit it. Please read submission guidelines before writing and submitting your comment.
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