Multifamily Property Managers and Owners Have Plenty to Celebrate for National Optimism Month
Until recently, I had no idea that March is National Optimism Month. Usually, because March signals the beginning of Spring, March Madness (Go Hoosiers!), and St. Patrick’s Day, that’s enough to be optimistic without having an entire month designated for Pollyannaism.
Whoever designated March for 31 days of hopefulness is unclear, as is how far back it dates. This may or may not be one of those Hallmark holiday. But taking it for what it’s worth, I decided to see just how much optimism the multifamily industry could contribute to the third month of the year.
Looking at some recent news items, I think we can agree that things look pretty good in the rental housing industry.
Apartment Professional’s Mood is on the Rise
At January’s National Multi Housing Council (NMHC) Apartment Strategies Conference, “the mood was optimistic” among multifamily executives who expect that in 2012 the pace of rent growth would continue to trend upward. Panelists were hopeful because jobs are coming back and auto sales, a key indicator of consumer confidence, are up. Another report said that “optimism reigns” at the conference.
Apartment Demand is on the Rise
A quarterly report published last fall by the National Association of Home Builders (NAHB) says that builders in the 55+ housing market are “significantly more optimistic” about production and demand for the multifamily rental units than they are for sales of single-family homes or multifamily condos. In February, NAHB said that multifamily housing demand will outpace current capacity, which will increase rents for property owners.
Apartment Starts are on the Rise
Also, a recent Bloomberg’s BusinessWeek report said that an economist from Moody’s Analytics predicts that new starts for 2012 “would make residential developers across the country happy.” According to economist Celia Chen, starts on apartments and townhomes will jump 74 percent from last year to 310,000. The NAHB said the predictions were “overly optimistic”. Problem is, says NAHB, is that developers need the capital to move dirt and credit is still tight.
Apartment Rents and Occupancy are on the Rise
At Property Management Insider, our colleagues at MPF Research are optimistic as well. Overall U.S. apartment revenue growth will nearly match hefty results posted in 2011, according to a January press release. Occupancy is expected to move up another half percent, and rents are forecast to rise 4.5 percent.
(Also see a video breakdown: What to Watch for in 2012 in the U.S. Apartment Market)
British actor Peter Ustinov reminds us that “the point of living, and of being an optimist, is to be foolish enough to believe the best is yet to come.” But the data and economic indicators suggest that the multifamily housing industry is going to continue its upward ascent, better in some markets than others, of course, but overall most property owners and managers should be smiling.
How are you feeling about 2012 so far? Are you feeling optimistic about the multifamily industry? Share your reasons below.