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Friday, May 17, 2013
Are investors horsing around?
Last year was a good year for apartment sales in the Puget Sound region. In fact, with $2.6 billion of property changing hands, it was the third best year ever. So let's see how active investors are this year by comparing the first four months of 2012 sales activity with the same period this year. That will tell us whether investors are still serious about this market, or just horsing around.
Wednesday, May 8, 2013
New highs for newer units
Prices for apartments built in King County since the beginning of 2000 rose rapidly through 2007. Then they fell during the recession. But the latest online update of our Apartment Investment Report shows that it took until this year for prices to regain lost ground and set new highs. How did that happen? What can we expect next?
Friday, May 3, 2013
Small property performance
We usually talk about trends for 20-unit and larger apartments. But there are a lot more investors involved in smaller rental properties like single-family rentals, multiplexes, and 5 to 19 unit apartment buildings. The proof: Each spring we survey just over 2,100 20-unit and larger properties for our Apartment Vacancy Report and more than 5,000 smaller properties for our 1-19 Unit rent & Vacancy Report. So this week we will talk about some of the trends we found in King County from our smaller property survey, published last week.
Friday, April 26, 2013
Patagonia vs. apartments
Patty and I enjoy the outdoors, especially remote locations in the mountains. No buildings, no people, just empty. Patagonia provides lots of opportunities to enjoy vacant space. That's a very good thing, in Patagonia. But in our day-to-day lives in the Puget Sound apartment market, vacant space isn't a good thing. Last week we looked at how unit size has a significant impact on the rate of rent growth. This week's video looks at how unit size influences vacancy rates.
Friday, April 19, 2013
The Bedroom Challenge
Remember the Pepsi Challenge commercials from the 1970s? Pepsi won because it was sweeter, or so the story goes. Apartment investors often ask us which is sweeter, apartments with fewer bedrooms or those with more. They want to know which unit types will perform best in a recession, and which will perform best overall. Well, let's take a look.
Friday, April 12, 2013
Out of whack
It's tax time again. Income taxes are due Monday and real estate taxes are due in a couple of weeks. It's not a particularly fun way to close the week, but here's a discussion of real estate tax trends impacting apartment investors in the Puget Sound region. No, it's not a fun topic, but we wanted to prove Jack Nicholson wrong. You can handle the truth.
Friday, April 5, 2013
Investing in a quarter
Some investors have a mixed attitude about buying right now, but they are buying anyway. They complain about how high prices are and how low the capitalization rates are. They fear interest rates will increase and that will drive up cap rates. And they are concerned about all the new construction in our market. But in the next breath, they tell us that, in spite of these concerns, they still think apartments in the Seattle metro area make more sense than alternate investment options. So let’s take a look at how this year is unfolding.
Friday, March 29, 2013
Hotter than a 787s lithium battery
The market vacancy rate in the Puget Sound region is 3.8%. That’s the lowest it has been since 2007. It doesn’t get that low very often. In fact, it has been that low just three other times in the past 30 years. These are some of the findings of our survey of 20-unit and larger apartments in the Puget Sound region, published in the Apartment Vacancy Report. The survey ended on Friday, March 22nd. We proofed the data on Saturday and published the report online on Sunday. We survey the entire market and collect reliable information for 217,637 units in 2,147 properties. That’s 88% of the market.
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May 22, 2013
Fred Reininger: Washington Federal has subscribed to Dupre + Scott for many years and find it an invaluable tool for underwriting our multifamily loans. The Apartment Advisor keeps us up date on trends in the marketplace so we can keep our underwriting current. What helps us the most is having access to the on-line rent, vacancy, and expense report generating capabilities. These tools let us tailor the reports we generate to a specific market area for the type of apartment building we are looking at financing. From these reports we can see what the vacancy is in the area and if ownerâ€™s expense numbers look reasonable, allowing us to be more confident in the letter-of-interest and loan applications that we issue. I highly recommend Dupre + Scott to anyone with a vested interest in the apartment market. (Fred is Senior Vice President and manager of Income Property Financing for Washington Federal Savings in Seattle.)