As fall approaches, there are a number of questions floating around about the DC area housing market. Will the tight inventory in the for-sale market continue? Will the slew of new apartments entering the rental market push rents down? Will the effects of sequestration become more noticeable?
With these questions in mind, each day this week UrbanTurf will be hearing the predictions and trends that local industry professionals believe will play out in the fall market. In today’s prediction, the founder of Delta Associates explains why renters will find more choices and possibly more deals in the coming months.
Renters Will Have More Choices, Buildings Will Offer More Concessions
By Gregory H. Leisch, CRE — Founder and Chief Executive, Delta Associates
The commercial real estate cycle will continue to move in favor of the renter this fall, as the development industry delivers an outsized number of apartment projects/units to the market. While this will not result in rents declining as much as tenants may have hoped, there will be many more choices on the market, which could result in the return of concessions or specials on new leases.
While rents are down 0.8% metro-wide since last year, an increase in the number of actively marketing new projects is what will benefit the area renter this fall. For example, metro-wide in 2011 there were 23 new projects actively marketing. Today there are 52 and by the end of the year there will be 60 projects actively marketing new units.
The abundance of new choices could mean more concessions as well. While still low, concessions at Class A apartment projects in the region increased slightly to 2.4% of face rent in the middle of 2013 versus 1.9% a year earlier. This trend could continue as the new projects hit the market in the coming months.
See below for more fall predictions.
See other articles related to: dclofts
This article originally published at https://dc.urbanturf.com/articles/blog/fall_market_predictions_more_choices_more_concessions_for_renters/7518.
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