Apartments: Increased Occupancy, Rents, and Net Income
April 26, 2011
From the Associated Estates Realty Corp (AEC) conference call, an apartment REIT in IN, OH, MI and PA (ht Calculated Risk):
Looking at certain performance metrics throughout our portfolio, we continue to see residents staying longer – on average, 18 months. Also, it has been well publicized, households have a greater propensity to rent versus own as renting allow for increased financial flexibility and physical mobility. To this point our annual resident turnover is down 10 basis points year-over-year and buying home as a reason for moveout is just over 14%, down from better than 25% just a few years ago. These trends are contributing to increased occupancy, increased rents, and improved same community NOI as a result of the lower turnover costs.
Other apartment owners have also told me that the number of renters “moving out to buy a home” is way down.
