Luxury apartments struggling to rent out his unit throughout the US
Luxury apartment building owners are struggling to rent out the units that are currently flooding the urban centers throughout the United States.
Since 2012, the supply of apartments has swelled to 16.6 percent in the central business district and 13.5 percent in the region “secondary core” that surrounds the city centers.
However, only 5.5 percent for the addition of secondary apartments in the suburbs.
Downtown buildings has been publicized by the developer to meet the needs of the millennial.
In addition, this apartment is also eyeing the other age groups, who wanted to be closer to amenities, nightlife and a car-free lifestyle.
According to data from real estate research firm Costar, developers put too many apartments are mostly located in the high end market, downtown, and does not affordable enough for in remote areas.
Over the last four years, the vacancy rate in urban centers and adjacent areas increased from 3.4 percent to 5.5 percent.
Although the new apartment complexes typically takes to rent, lots of empty units longer than usual.
Nationally, new apartments have an average vacancy rate of 52 percent when it opened in the first quarter of 2013, and this figure drops to around 11 percent within 18 months.
While the new unit opened in the first quarter of 2015 had a vacancy rate of 72 percent and decreased to 18 percent during the same period.
This high vacancy driven by luxury buildings in the central business district.
“The new building is striking and the scene in the city center, has a vacancy problem. The units are too expensive to rent,” said Chief Economist Hans Nordby.
He added that at the same time, not a lot of supply of new apartments in the suburbs.
As a result, since 2012, the average rent has increased by 12.3 per cent in urban centers and 18 percent for mid-level suburban apartment.
Cities suburb separate metro areas across the country are also experiencing particularly acute void. The large cities such as Los Angeles, Washington and Chicago.
In Los Angeles, about 5,500 apartments operates in the last 3.5 years, with rents of about 6,500 US dollars per month.
While the vacancy rate region as a whole has increased from 4.5 percent to 9.9 percent.
In the suburbs, only 1,900 units of apartments medium-enter the market since 2012 and the vacancy rate has dropped to 2.8 percent from 3.7 percent.