IRR-Cincinnati Mid-Year Viewpoint 2015 Local Market Report - Multifamily
The multifamily sector throughout the Greater Cincinnati area and around the country has lead the real estate recovery over the last year or so. This resulted from the fact that more individuals were seeking apartment living after having to live with family or friends due to the depressed job market which was partially the cause for a high rate of foreclosures in the single family market. As a result, conditions within the multifamily market have rebounded significantly.
New construction is occurring throughout the urban and suburban markets with the overall inventory increasing at an annual compound rate of 0.4% since 2004. It is anticipated that approximately 2,000 additional units will be added to the market over the next three years.
The Cincinnati multifamily market benefits from a stable to slightly growing population base and higher income and education levels.
The Cincinnati area has maintained a generally lower unemployment rate than Ohio during this time, which is a positive indicator. Moreover, the Cincinnati MSA exhibits both a higher rate of GDP growth and a higher level of GDP per capita than Ohio overall. All of these factors will continue to support the current recovery.
The multifamily market has generally strengthened over the last four years. The overall vacancy rate is currently estimated to be in the 4-5% range, which represents continued decline from the recent high of 8.0% in 2009; absorption turned positive in 2010 and has continued. Rents have increased significantly within the recent past, driven by the low vacancy.
Overall, the multifamily market has shown an upward trend recently. With the improvement in the single family housing market, it is likely that the multifamily markets have reached their peak, with vacancy and rents leveling off moving forward.
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IRR Mid-Year Viewpoint 2015 comprises a National Overview report and 300+ two-page Local Market Reports for all key property types as well as additional resources, including metrics methodology, graphs, and tables; these free reports may be downloaded from IRR’s site here.