Apt. rents could see double-digit declines - Denver Business Journal:

ibitasony.wordpress.com
After essentially holding steady in late 2008 and early effective rentsdropped 1.7 percent duringy the second quarter of this year. Mid-2009 rents also were 1.7 percenft below their June 2008 levels. The average apartmentt rent acrossthe Dallas-Fort Worthh area in June was $753 per month, the MPF researchu shows. Job losses in North Texaas have hampered demand at the same time as new supplh is hittingthe market, said Greg Willett, MPF Research’sx vice president of research. "Renty reductions have seemed inevitable, and now they’rre here,” Willett said.
The declining occupancy and rent rates show the Texase apartment industry is feeling the effectsz of thenational recession, said Will vice president of investments for the Balthropse Group of s. "Across the in this country, we are seeing erosion of top-line incomse and net-operating income due to the recessioj and most specifically due to job said Balthrope, who specializes in the multifamily "Even though Texas was the last statde to be affected, our apartment marker is tied to the job market.
That beinv said, we expect to see continueds erosion in rent levels due to increasing vacanciex over the next 12 to 18 InNorth Texas, the biggest rent cuts came in Dallas' urban core, the MPF research Effective rents fell more than 8 percent betweenj mid-2008 and mid-2009 in the Downtown/Uptown and Oak Lawn submarkets. The occupanc rate for Dallas-Fort Worth area apartments was 90% as of Occupancy dropped half of a percentage point during the second quarter, making the decline a full 3 percen for the year ending in June. The region had 840 net move-outws during the second quarter, which normally is a seasonallg strongleasing period.
For the year ending June 30, the regiobn had 6,910 net move-outs. The move-outs come at a time when 12,633 unitsx of new supply have been added for the year endingtJune 30. New apartment starts in Nortjh Texas almost completely disappeared duringbrecent months, but properties begun earlierf and still in process total 21,33q1 units, Willett said. After the apartments now undetr constructionare delivered, it will probablty be three years before more units are started in the Dallas-Forft Worth area, said Brian managing broker of the office in "When you shut the supply off, you'll see occupancieds gradually improve and concessions start to decrease," he Investor interest in the Dallas-Fort Worth apartment which has been dormangt for the past year, is beginningy to return, O'Boyle said.
He said the D-FW apartment markety will bounce back more quicklythan most. MPF Researcjh predicts that apartment demand in Nort Texas will rebound into slightly positive territory durint thenext year, but "there’s no way that absorption can come anywheres close to the aggressive completion volume that lies Willett said. That means occupancy will decline further and rent cutswill continue. he said. MPF Research is forecastingt rent declines near the 4 percent mark for the year endingbJune 30, 2010. “Neighborhoods with lots of new supplyu still on the way are headed forreal trouble,” Willetf said.
“It wouldn’t be surprising to see double-digit rent drop in areas that include the urba n coreof Dallas, northern suburbs like Frisco and and the Fossil Creek area of Tarrant