Today we’re going to talk about the health of the apartment market. Thanks for tuning into The Real Estate Today podcast.
And I’m Bob Nelson, real estate investment broker with Pacwest Real Estate Investments.
Bob Nelson: Today I’d like to deal with the apartment market; it’s my specialty, I buy them, I sell them, I do tax deferred exchanges with them and I’m pretty familiar with the apartment market between here and Seattle, Washington. I’m licensed in Oregon, Washington, Idaho and Arizona so I do keep an eye on those various markets. Those are the markets where money is moving into and once it gets here, where it also moves toward etc.
So with that I think the quickest measurement of the health of the apartment market is the vacancy factor. How many units are vacant percentage wise of the units that are there? And it’s interesting in the Eugene, Springfield area, our vacancy factor is by stated statistic. A survey was made very recently as 2.4% had a long time ago, housing and urban development had created a standard for a real estate market. And if it’s a vacancy factor of 5%, that’s considered to be in balance.
Now whether that is continued to true, I’m going to use that statistic which would indicate that we have a fairly tight market. There’s not a lot of vacant units to choose from if you come to town and are looking for an apartment complex. It’s the greatest vacancy for apartments should be in the three and four bedroom variety. There, you’re going to see 6-8% but a lot of that is campus. University of Oregon campus and so forth.
You get into the normal market where if I was a family moving to town, I might be looking for a two to a three-bedroom unit and there, we’re starting to hit the low vacancy of the tight market. It’s an interesting situation, is anything going to change that?
Well there’s nothing more certain that change. If you watch the Portland market, the Portland apartment market, that’s a precursor of what happens down the Willamette Valley. The Salem market, the Eugene market further down to Medford and so forth. It’s interesting. Their rents are easing up. More on this in my next program.
I’m Bob Nelson, real estate investment broker with Pacwest Real Estate Investments.
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