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Industry Groups Launch Rental Housing Initiative


Several resources are being offered through the COVID-19 Rental Housing Support Initiative that will be released in early 2021.


Recent reports detail a downward trend in residential rent collections as stakeholders seek solutions.

The Institute of Real Estate Management (IREM), National Apartment Association (NAA), National Multifamily Housing Council (NMHC) and National Association of Residential Property Managers (NARPM) has now launched its COVID-19 Rental Housing Support Initiative, which was announced back in October. Yardi is acting as the primary sponsor of the program. Last year, the company pledged $1 million to support COVID-19 rental housing and the programs developed by those initiatives.

“We are pleased to support the COVID-19 Rental Housing Support Initiative, enabling our industry’s largest associations to provide rental housing providers with needed support,” Esther Bonardi, vice president of marketing at Yardi, told Multi-Housing News. “NAA, NARPM, NMHC and IREM have worked tirelessly to provide important resources to help preserve the health of our industry. By collaborating on this project, these associations will reach a vast majority of apartment and rental housing managers with the tools they need most to survive and thrive during the pandemic and beyond.”

Several types of support are being offered that will be released in early 2021 through March. These can be found at covidinitiative.rentalhousingindustry.org.

Below is a list of the resources that will be provided:

Mental health—Focusing on isolation and will be followed up with additional content released over the next few weeks that cover resiliency, anxiety and financing stress.

Legislative—Data and information provided in a variety of formats so people can understand how important it is to create emergency assistance programs and comprehend how the eviction moratoriums impact them.

Liability—Property owners and operators will benefit from keeping up with the latest guidelines and legislation. An e-book will be provided to help with these issues, as well as attorney information in a online resource library.

Media—The program will offer a quiz called “The Rental Housing Industrial Myth Quiz,” which will engage with the public and provide resources on the situation for multifamily owners and operators. Information will include the impact of the pandemic on their businesses and reinforce themes like the value of renting.

NAAEI Apartment Jobs Snapshot Q4 2020

In this edition of NAAEI’s Apartment Jobs Snapshot, apartment jobs delivered a strong performance during the final quarter. Job openings in the apartment industry comprised 39.2 percent of positions available in the real estate sector, well above the average of 31.3 percent. Maintenance positions had the greatest year-over-year growth, increasing by 3.5 percent. Dallas, Los Angeles, Washington D.C, Seattle and Atlanta were among the top markets for apartment job demand. Leasing consultant were in highest demand for student housing properties.

 

RealPage presents 2021 market outlook

RealPage recently presented a webinar forecasting the likely trends for the multifamily housing market over the next two years. Presenters were Greg Willett, Chief Economist, and Adam Couch, Market Analyst.

The webinar spent significant time reviewing the performance of the multifamily housing market in 2020 in order to set the stage for what they expect to come. Some of this is material that was covered in RealPage’s 2020 review, and will not be discussed here. This article focuses on RealPage’s view of what lies ahead.

Employment drives the economy

RealPage reported that the recovery of the huge number of jobs lost to the pandemic-inspired shutdowns is only half complete. There are still 9.2 million net jobs that have disappeared from the economy. RealPage based their forecasts for the next two years on the economy recovering 5 million jobs in 2021, mostly in the second half of the year, and another 2 million jobs in 2022.

The apartment industry enters 2021 with overall occupancy running at a relatively healthy 95.6 percent, according to RealPage. By apartment class, occupancy is 94.6 percent in Class A properties, 95.7 percent in Class B properties and 96.3 percent in Class C properties. However, there is a huge pipeline of new product on the way and this is likely to put pressure on occupancy.

The first chart, below, shows the RealPage forecast for new product deliveries over the next two years. While deliveries in 2020 hit a recent high, 2021 deliveries are expected to go even higher, reaching a little over 400,000 units.

expected apartment deliveries
RealPage forecasts apartment demand in 2021 in the 150 largest metros to come in at 307,000 units. This is up from estimated apartment absorption of 296,000 units in 2020 but down from absorption levels of 327,000 units in 2019 and 353,000 units in 2018. Since new product deliveries are forecast to outpace absorption next year, occupancy rates are expected to decline from their recent highs. RealPage’s occupancy forecast is shown in the next chart, below.

forecast apartment occupancy
Source: RealPage

The chart shows occupancy rates exhibiting normal seasonal variations but trending slightly down over the next two years. However, occupancy is expected to remain at healthy levels, around 95 percent, over this time frame.

Generous new supply of apartments and stagnant to declining occupancy is expected to put continued pressure on rents in the near term. The RealPage forecast for rent growth is shown in the next slide, below. RealPage forecasts rent growth to turn positive in late 2021 and to return to pre-pandemic levels by the end of 2022.

forecast rent growth
Source: RealPage
Some metros will struggle

While the above charts provide the 2021 market outlook for the country as-a-whole, individual metros may see different results. Metros where significant new product is in the pipeline, especially where net move-outs have taken place, such as San Francisco and New York, will continue to struggle over the next two years. In fact, RealPage forecasts that 17 of the country’s top 50 metro areas will not see a return to 1Q20 rent levels until 2022 or later. In addition to San Francisco and New York, the other metros in this category are San Jose, Los Angeles, Chicago, Boston, Washington DC, Oakland, Seattle, Orlando, Austin, Miami, Houston, Nashville, Minneapolis, San Antonio and Dallas.

RealPage also discussed apartment building sales and cap rates, but the focus was more on recent history rather than on future outlook. Basically, sales volume dipped in the middle of the year but rebounded in the fall. Apartment pricing has held up reasonably well with the national average sales price remaining close to its recent high at $176,000 per unit. Cap rates are at 5.1 percent and are pretty consistent around the country.

In response to a question, RealPage discussed the Las Vegas paradox. Las Vegas is a city where employment was hard hit but where occupancy and rents have gone up. They explained this paradox by noting that Las Vegas also has lots of missed rent payments which will result in evictions when moratoria are lifted. Therefore, the current occupancy numbers are somewhat misleading.

The webinar concluded by stating that suburban markets ought to outperform the urban core and that Class B properties ought to outperform Class A and Class B properties in the near term.

The full webinar discussed other topics and provided information on expected product deliveries to certain urban markets. It is available on demand and can be found here.

NATIONAL APARTMENT ASSOCIATION ~ President Robert Pinnegar, CAE



Dear NAA Members,

Earlier this evening, President-elect Biden revealed details of The American Rescue Plan, a sweeping COVID-19 relief package that includes several provisions of note for the rental housing industry. Of primary concern is a drastic federal eviction moratorium, to be in effect through September 30, 2021. On a positive note, the package also includes funding for $25 billion in rental assistance, $1,400 per-person stimulus checks for qualifying households and enhanced unemployment benefits.

The President-elect did recognize the millions of struggling mom-and-pop rental housing owners and operators and claimed that his proposals will also be an “economic bridge to recovery.” However, as the apartment industry well knows, some level of federal eviction moratorium has been in place for nearly a year and targeted, direct rental assistance did not arrive until nine months after the pandemic began. More help is needed, and it is needed now without an eviction moratorium attached.

While we applaud the Biden Administration for calling on Congress to pass further rental assistance, action must be taken immediately. We call upon Congress to enact additional rental assistance without delay, so that rental housing providers of all portfolio sizes may be made whole and can continue operations – keeping America’s 40 million renters safely housed while the pandemic continues to rage. Additionally, we urge Congress to avoid any extension of any eviction moratorium, which only cripples housing providers, hurts housing affordability and harms the very Americans it seeks to protect.

As always, NAA will continue aggressively advocating for policies that meet the unique needs of our industry. We welcome the opportunity to work with the Biden Administration and the 117th Congress to craft the most effective short- and long-term solutions to the housing crisis created by the COVID-19 pandemic. We will continue to keep you apprised as we further digest President-elect Biden’s proposal.

Stay healthy and well,

Robert Pinnegar, CAE
President and CEO


National Apartment Association

Lessons from Single Family: Self-Guided Tours Are Here to Stay


December 21, 2020

In the era of COVID-19, self-guided tours have moved from forward-looking innovation to necessity, with the early adopting single-family market offering a roadmap for multifamily professionals. 

By Samantha Chalmers

Before COVID-19, self-guided tours were a cautiously adopted solution throughout the multifamily housing industry.

But as panelists discussed in the session, “Lessons from Single Family” at APTvirtual, single-family housing was an early adopter that experienced significant success with this touring model. The path of that experience provides an effective roadmap for multifamily operators as COVID-19 accelerates adoption of self-guided tours throughout the industry.

The effectiveness of that roadmap is found in the data from single-family self-guided tours that indicates that residents frequently utilize self-touring, which also shortens the lead to lease conversion timeline. 

“Customers want to be able to find information about an apartment community in any way that they want,” explained Todd Katler, CEO and founder of Anyone Home. “Operators who allow prospects to trade in their own currency will see the benefits of providing multiple platforms in the form of increased conversion and accelerated leasing velocity.”

According to an analysis of the 2018 leasing activity of Anyone Home’s single-family clients, 61.3% of prospects who booked a tour chose only a self-guided one, while 30.1% chose only a tour with an associate and 8.6% booked both tour types. Those who used self-guided tours converted to a lease at nearly twice the rate—9.3 % vs. 5%—than those who didn’t.

Single-family prospects who completed a self-guided tour at any point in the leasing process had a 54% higher conversion rate compared with those who only took an agent-led tour. One out of every four prospects who participated in a self-guided tour leased. Sixty-seven percent of prospects who leased after touring completed a self-guided tour as their first tour. Thirty-three percent of prospects who leased after touring completed a self-guided tour as a subsequent tour.

The data, however, wasn’t the driving force for single-family operators like Invitation Homes. It was an operational necessity born from the challenges of leasing homes dispersed across an entire metro area rather than in a single multifamily community. That innovation necessity, fortunately, produced significantly positive results for the company and prospects.

“It’s a win-win,” said Phil Rogers, Director of Operational Planning and Analytics for Invitation Homes, which owns and leases single-family homes. “It allows scalability, it allows efficiency on the leasing side, but it’s also extremely attractive to the consumer. Even if when we offer a 50/50 model, it’s the first choice of a growing number of prospects.”

Because of the Covid-19 pandemic, many multifamily operators find themselves in a similar situation Invitation Homes was in when it first started offering self-guided tours. It’s more of a necessity than a forward-looking innovation.

“Covid really changed the way we looked at this technology. We no longer had the luxury of determining what we want, but instead we had to figure out what we need in order to maintain operations,” said Kari Warren, Executive Vice President at Kairoi Residential.  “Once we realized that we needed to quickly shift the way we tour, all of the features we wanted on a self-guided tour option became secondary to our need to provide prospects with a quick and easy way to tour that still felt safe.”

So much for cautious adoption.

Samantha Chalmers is an Account Director for LinnellTaylor Marketing.

Explaining the Breakdown of One Dollar of Rent


January 4, 2021

There exists a misconception that rental housing owners enjoy large margins and can continue operating in the absence of rent payments, and with so much discussion around rents during COVID-19, the National Apartment Association (NAA) has released resources that help explain the breakdown of $1 of rent.

Because education is an effective way to counter harmful public policy and negative industry stereotypes, NAA offers this explanatory video and companion infographic breaking down a dollar of rent into its component parts.

The apartment industry must help society understand the benefits of rent payments for all Americans, whether or not they reside in rental housing.

From supporting 17.5 million jobs to the dollars reinvested into apartment communities to ensure quality living for more than 40 million residents, and through paying property taxes that finance schools, emergency services and other local needs to investor returns that include public pensions and 401(k)s, a rent payment is much more important than one might otherwise realize.

TAAEF’s “Be the Next Room to Grow Ambassador” video challenge is back with a twist!


By Becca Ramati, TAAEF Vice President
Dec. 8, 2020

Synopsis

As part of the Room to Grow campaign, the Texas Apartment Association Education Foundation is again launching the “Be the Next Room to Grow Ambassador” video challenge—this time for maintenance professionals only!


Key takeaways

  • The “Be the Next Room to Grow Ambassador” initiative is an internal video challenge for industry employees in maintenance positions to tell us their stories and to be an Ambassador for the industry.
  • Submissions will be accepted beginning on January 4 and the process is easy—simply record a short video of yourself telling us who you are, what you do and what you love about your job.
  • Encourage your friends and maintenance staff to submit a video, too—one of you just might be our next ambassador!

By popular demand, the Texas Apartment Association Education Foundation is excited to bring back the “Be the Next Room to Grow Ambassador” video challenge, part of the Room to Grow campaign.

This year the campaign is focusing on maintenance professionals, the often-unsung heroes of the multifamily industry who keep properties in working order and safe. Not only do they keep things running smoothly, they also help our residents feel at home.

Maintenance is the #1 need when it comes to recruiting and staffing for multifamily properties. TAAEF hopes this focus on maintenance provides more stories to share that resonate with Texans looking for not just a job but a career.

To participate in this year’s “Be the Next Room to Grow Ambassador” video challenge, submit your video between January 4 and before midnight on January 26.

How the “Be the Next Room to Grow Ambassador” video challenge works

Click to sign up!
  1. Watch TAA and TAAEF social media and your email for more information later this month.
  2. Record a short video highlighting your work as a maintenance professional.
  3. Submit your video starting January 4. The deadline for submissions is January 26, 2021 at 11:59 p.m. Central. (You’ll submit your video by uploading it here.)
  4. A committee of industry leaders will select three-to-five finalists.
  5. Each finalist will be notified. Finalist are encouraged to share information with family, friends and colleagues who can cast votes in the finalist round.
  6. The public is invited to vote for their favorite finalist video between February 3-11, 2021.
  7. The winner of the public voting is selected as the next Room to Grow Ambassador. The winner will be announced February 15.

The winner of the challenge will be featured in a professionally produced video and receive high-quality photographs. This video will debut at the TAA ONE Conference & Expo and the winner will receive a free registration and hotel stay during the conference. The new Ambassador will also be featured in Texas Apartments magazine, TAA Viewpoints newsletter and throughout TAAEF and TAA’s social media channels.

Please share this article and opportunity with any colleagues you think would be a good fit and encourage them to participate—we’d love to hear their story.

It is TAAEF’s hope that “Be the Next Room to Grow Ambassador” empowers you to share your story to help raise awareness about the diverse, quality career opportunities in the Texas apartment industry.

For any questions, please reach out to TAAEF staff at taaef@taa.org.

Submit your video!

Amenities Reevaluated for Post-Pandemic Times


The pandemic will continue to shape amenity priorities well into the future.

By Doug Pike

When the Covid-19 pandemic first arrived, amenity closures were among the first direct actions taken by apartment communities. The months-long process of reopening those common areas has exposed the evolving needs of residents and the lasting imprint the pandemic will undoubtedly have on multifamily.

NAA’s APTvirtual session, “Amenities Reevaluated in Post-pandemic Times,” led by moderator Syd McDonald, Senior VP of Sales for Valet Living, assessed the impact that the pandemic has had on amenities and how it is shaping amenity priorities moving forward.

“As an industry, our first priority was how to keep our employees and our residents safe,” said Sheri Druckman, VP of SRG Residential. “Right out of the gate, we implemented really strict sanitation guidelines and, if you hadn’t already, you immediately implemented online leasing, online rent paying and virtual tours.”

Druckman said that once amenities began to reopen in phases, most properties introduced precautions such as digital reservation systems, capacity restrictions, repurposed common areas with staggered seating, mandated social distancing and virtual event alternatives. The struggle has been finding ways to retain a sense of community with so many ongoing efforts to keep residents safe and separated.

“We really wanted to keep that resident connection alive, so all of the events that we typically would have done in person, we had to restructure and do virtually,” Druckman said. “You saw a lot of virtual fitness classes, movie screenings, virtual happy hours and even cooking demonstrations.”

Adapting to New Resident Needs

While communities adapted to reinstate amenity use following initial closures, they also had to accommodate a wave of new resident demands. Druckman said renters have placed a priority on high-speed internet, home office space, private outdoor spaces, valet trash and recycling services, touchless systems, soundproof walls, in-unit laundry, delivery and food services, and package storage capacity.

Nancy Goldsmith, Managing Director of Bozzuto Management Company, said the changes on the site level since the start of the pandemic have been significant enough to force developers to rethink their amenity and property designs moving forward.

“We think a lot about the design of our communities, and we know that our communities look a lot different than they did eight months ago,” said Goldsmith, who noted that a survey of Bozzuto’s resident advisory panel found that 78% of residents plan to continue to work remotely after the pandemic. “Working from home is here to stay. That puts a lot of pressure on how we design our apartments. We’re thinking about the natural light. We’re thinking about our working parents and how they have to multitask. Internet is very important and we’re now offering internet as one of our incentives.”

Druckman said that in March the average gigabyte usage at SRG properties increased by 42%.

After working and schooling from home, the other major shift the industry has seen is in the number of goods residents are purchasing online and having delivered to their communities. In April and May, SRG’s mail and package volume rose to 7% higher than the 2019 holiday season, Druckman said.

Goldsmith said 86% of Bozzuto residents now rely on online shopping and deliveries for at least some things, according to survey data. Of those surveyed, 51% said they are purchasing groceries online, which also increases the demand for cold storage in package rooms.

Tami Fossum, Executive Director of GEM Management, said that affordable and senior housing communities are seeing subtle variations on amenities as a result of the pandemic.

“We’re not usually going for sexy, like you will see in your Class A properties. We’re going for functionality,” Fossum said, noting that properties have to cater to their state’s Qualified Allocation Plan (QAP) in order to earn enough points to qualify for tax credits.

Fossom said affordable properties are now looking at security camera systems, community rooms, outside relationships offering supportive services, playgrounds, laundry rooms, fitness and wellness programs, and sometimes pools, depending on state QAP specifications. Senior housing communities are focused on fitness centers, recreation and community spaces, libraries, computer stations, outdoor conversation areas, controlled access technology and elevators.

The experts agreed that many of the changes and technologies brought about by the pandemic—including high standards of cleanliness, air purification systems, touchless proptech, connections to the outdoors, larger floor plans with flexible spaces, multipurpose convertible furniture, antimicrobial finishes, optimized technology, and a focus on health and wellbeing—are here to stay.

Doug Pike is a Content Manager for LinnellTaylor Marketing.

TAA urges state to prioritize vaccine for apartment personnel


The Texas Apartment Association is asking the state to consider prioritizing apartment workers for the COVID-19 vaccine.

 

Key takeaways

  • Texas Apartment Association Executive Vice President Chris Newton sent a written request asking the state to consider prioritizing apartment personnel for the state’s allocation of COVID-19 vaccine.
  • TAA notes that many apartment leasing staff and maintenance professionals must provide services but may not be able to remain physically distant while doing so.
  • Learn more about the state’s vaccination efforts. 

The Texas Apartment Association has formally requested that the state prioritize COVID-19 vaccines for apartment personnel.

In a letter dated January 5, TAA’s Executive Vice President Chris Newton wrote Dr. John Hellerstedt, who heads the Texas Department of State Health Services. Dr. Hellerstedt has been charged by Gov. Greg Abbott with determining how the state’s allocation of vaccines will be distributed based upon the input and recommendations of a 17-member Expert Vaccine Advisory Panel. More information about Texas’ vaccination efforts can be found here.

While the first two phases of vaccine allocations have been dedicated to front-line health care personnel, residents of long-term care facilities, the elderly and others with chronic health issues, it is hoped that the next round of allocations will go to workers in essential services, including onsite multifamily staff, who come into close contact with the public.

In particular, the letter cited the need to help protect leasing office staff and maintenance personnel who must provide services but may not be in a position to socially distance.

Read Newton’s letter to Dr. Hellerstedt.

Be the Next Room to Grow Ambassador: Maintenance Edition


Be the Next Room to Grow Ambassador: Maintenance Edition

 
What a great way to kick off the New Year!  I’m excited to announce that the “Be the Next Room to Grow Ambassador” video challenge is back. This year we are highlighting our maintenance professionals and we need your help in encouraging submissions.
 
Our maintenance professionals are often the unsung heroes of the multifamily industry keeping our properties in working order, especially in times of crisis like we’ve had this past year. This is a great opportunity to recognize them and let them know what they mean to the success of their properties and your company. Please reach out to your teams to encourage your maintenance professionals at all levels to consider submitting their stories as part of the video challenge.
 

Download this flyer to share with your team

 
The submission process is short and simple – just visit this website for more information and to submit videos. Submissions will be accepted
through January 26th so don’t delay!

A committee of industry leaders will select 3-5 finalists. Then, each finalist will be notified and announced for a public vote (share this widely with your own network as friends, family, colleagues and more can all vote) and a winner will be announced as the next Room to Grow Ambassador. The winner will receive a professional video of their story, professional photos, entry and expenses paid for the 2021 TAA ONE Conference & Expo, statewide recognition on social and print media and much more. 
 
The “Be The Next Room to Grow Ambassador” video challenge, part of the Room to Grow campaign, is an internal video challenge for industry employees in maintenance positions to tell us their stories and to be an Ambassador for the industry. Please help us as we work to raise awareness about our industry, especially during a time when so many could benefit from considering our career paths but have yet to find us.
 
For any questions, please reach out to TAAEF staff at taaef@taa.org. We can’t wait to hear stories from our maintenance professionals and to see who will Be the Next Ambassador!

Mike Clark, HCCP
TAA Education Foundation President