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The Cal State Companies: Center for Real Estate Studies ¨ Cal
State Properties ¨ Cal State Investment LTD Partnership
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The Center for RE Studies For:
Immediate Release
Just Released
1st Quarter 2019
Leading
Rental Income Markets
LOS ANGELES ,
CA
The current number of markets in the “Sell Phase” is forty-four,
according to Eugene E. Vollucci, Director of CRES. The number of markets in the “Buy Phase” is seven.
Mr. Vollucci states, “This quarter the three top buy recommendations are Beaumont , TX , Hartford , CT and Oklahoma City , OK
In this edition of our Market
Cycles, we find the National vacancy rates in the fourth quarter 2018 were
6.6 percent for rental housing and 1.5 percent for homeowner housing. The
rental vacancy rate of 6.6 percent was not statistically different from the
rate in the fourth quarter 2017 (6.9 percent), but lower than the rate in the
third quarter 2018 (7.1 percent). The homeowner vacancy rate of 1.5 percent was
0.1 percentage point lower than the rate in the fourth quarter 2017 and also
0.1 percentage point lower than the rate in the third quarter 2018 (1.6 percent
each).
The fourth quarter 2018 rental vacancy rate was highest
outside Metropolitan Statistical Areas (8.2 percent) and lowest in the suburbs
(5.9 percent). The rental vacancy rate in principal cities, in the suburbs, and
outside MSAs were not statistically different from the fourth quarter 2017
rates. The homeowner vacancy rates in principal cities (1.5 percent), in the
suburbs (1.4 percent), and outside MSA’s (1.5 percent) were not statistically
different from each other. The homeowner vacancy rate outside MSAs was lower than
the fourth quarter 2017 rate, while rates in principal cities and in the
suburbs were not statistically different from the fourth quarter 2017 rates.
Total nonfarm payroll employment increased by 196,000 in
March, and the unemployment rate was unchanged at 3.8 percent, the U.S. Bureau
of Labor Statistics reported today. Notable job gains occurred in health care
and in professional and technical services.
In March, the number of long-term unemployed (those jobless
for 27 weeks or more) was essentially unchanged at 1.3 million and accounted
for 21.1 percent of the unemployed. The labor force participation rate, at 63.0
percent, was little changed over the month and has shown little movement over the past 12 months. The
employment-population ratio was 60.6 percent in March and has been 60.6 percent to 60.7 percent since October
2018. The number of persons employed part time for economic reasons (sometimes
referred to as involuntary part-time workers) was little changed at 4.5 million
in March. These individuals, who would have preferred full-time employment,
were working part time because their hours had been reduced or they were unable
to find full-time jobs.
US Median Asking Rent is at a current
level of $947.00, a decrease of $56.00 or 5.58% from last quarter. This is an
increase of $37.00 or 4.07% from last year and is higher than the long-term
average of $586.44.
According to Berkadia, the U.S.
The rise in payrolls and wages along with positive contributions
from personal consumption expenditures and federal government spending
contributed to a 2.8% increase in real gross domestic product annually through
the fourth quarter of 2018. The expansion cycle is expected to continue through
this year with nearly 2.0 million jobs added for 1.3% growth. At the same time,
real GDP is forecast to expand between 2.4% and 2.7% this year. While national
employment growth remained strong in 2018, several major markets significantly
outperformed the national trend. Approximately half a dozen large markets’
expansion more than doubled the national rate.
ABOUT THE
AUTHOR: Eugene E. Vollucci is the Director of The Center for Real Estate
Studies, a real estate research institute.
He is author of four best selling books and many articles on real estate
investing, rental income properties and taxation. To purchase a subscription to
Market Cycles and to learn more about
the Center for Real Estate Studies, please visit us at http://www.calstatecompanies.com
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