Radix Weekly Data Report – June 24th
Both Traffic and Leases Are Showing Signs of Improvement

With the Fourth of July on the horizon, we continue to see positive developments when it comes to leading indicators in the apartment industry, according to new data from Radix.

On a national basis, both traffic and leases were slightly down on a week-over-week basis during the seven days ending on June 24. However, traffic is now only 15.6% behind when compared to the same time last year, and leases are up 3.9% from one year ago.

Also encouraging: both occupancy and leased percentage have increased for three weeks in a row. YoY, both metrics were still down 1.59% and 1.10%, respectively. But if the leading indicators such as traffic and leases continue to move in a generally positive direction, the YoY gaps in occupancy and leased percentage should close.

As for the national net effective rent (NER), that metric declined again WoW, and in fact the decline accelerated when compared to the preceding week (-0.4% for the seven days ending on June 24 vs. -0.2% for the seven days ending on June 17). However, YoY, the gap has shrunk slightly. The strongest headwinds to NER growth remain a resurgence of coronavirus cases (which are increasing in most MSAs) and continued economic fallout and uncertainty due to an increase in new cases.

With that background, here are more notable takeaways from the week ending on June 24:

  • As mentioned above, nationally both traffic and leases were slightly down WoW (0.7% and 1.1%, respectively). However, as also noted, the YoY trends are strong. Operators have clearly figured out ways to drive traffic and lease to make up for the ground they lost during the peak of the pandemic.
  • The national occupancy rate was 92.94%, and the leased percentage rate was 94.94%. That’s a WoW increase of 10 basis points and 19 basis points, respectively.
  • Fourteen of the 21 MSAs tracked by Radix saw their occupancy rates increased from the preceding week. The largest WoW increases were found in San Antonio (0.63%), Orlando (0.62%) and Denver (0.42%). The largest WoW decreases recorded in Miami (-0.84%), San Jose, Calif., (-0.45%) and Portland, Ore. (-0.31%).
  • At $1,727, the national NER stood 0.4% lower than the week before and 4.3% lower than the same time last year. On a WoW basis, NER declined in 13 of the MSAs tracked by Radix. Metros with the largest WoW decline were San Francisco (-1.4%), Riverside, Calif., (-1.1%) and Houston (-0.9%).

Radix Weekly Data Report – June 10th

Signs of Optimism for the Apartment Market

With states opening up from their pandemic shutdowns, May’s employment numbers were a pleasant surprise (finally, some good news!)

It looks like these trends are positively impacting the apartment industry. During the week ending on June 10, we saw some of the most encouraging signs of improvement in leading indicators since the pandemic hit.

According to Radix, both traffic and leases were up. If this trend continues, we should start to see the year-over-year declines in occupancy and leased percentage rates begin to compress. As of June 10, the occupancy and leased percentage rates were down by 1.72% and 1.34%, respectively, from the same time last year.

In addition, even the week-over-week decline in net effective rent has started to slow. Perhaps with improvements in leading indicators and occupancy and leased percentage, we will see a gradual stabilization in rent as well.

Now that you have the broad-picture summary, let’s dig into some of the specific takeaways from the week of June 10: 

  • Nationally, traffic was up 12% WoW. It’s still down 22.7% YoY, but that’s a smaller gap than earlier in the pandemic.
  • On a national basis, leases increased by 17.8% WoW. Leases also were up by 2.3% when compared to the same time last year; this is the first time in three months that leases increased YoY.
  • The national occupancy rate (92.72%) declined 11 basis points WoW, and the YoY gap increased to -1.72%. However, the leased percentage rate (94.61%) was up slightly for the week by 2 basis points, and the gap vs. last year is down to -1.34%.
  • In terms of metropolitan statistical areas, San Diego, San Jose, Seattle and San Francisco were the markets with the biggest YoY drops in occupancy rate. San Francisco, San Diego and San Jose are also in the top three in terms YoY dips in leased percentage rate. Meanwhile Phoenix, Dallas and Tampa are the closest to erasing their YoY gaps in leased percentage rate.
  • At $1,737, the national net effective rent declined WoW by 30 basis points. The figure represented a 3.9% decrease from the same time last year. Atlanta (-12.4%), Orlando (-10.2%), San Jose (-8.5%) and San Francisco (-7.0%) had the biggest YoY declines.

Radix Weekly Data Report – June 3rd

At Radix, we’ve been keeping a close eye on both national and local performance data as the pandemic unfolds. As June arrives and the summer begins, I think we all wish we could just undo 2020 and start anew.

During the week ending on June 3, most of the major performance metrics were flat to slightly negative, according to our data.

Nationally, traffic was up on a week-over-week basis, and the metric has been making up for the ground it lost during the early stages of the pandemic. Leases were slightly down for the week, but now stand only 13.3% below versus the same time last year. If leasing pace continues to improve, we should be on par with last year in a few weeks. It will also be a strong sign of demand improvement from the low record hit during the first phase of the lockdowns.

While the national net effective rent dipped only by 0.4% WoW, the year-over-year gap has been increasing and now stands at -3.5%.

It is still too early to tell how much protests and riots have impacted traffic and leasing, but next week’s data should give us a better indication of the overall effect. This could be part of the explanation why markets that have opened and showed strong traffic and leases during the week ending on May 27 – such as Atlanta, Houston and Tampa – registered slight declines in this week’s data.

Here are some of the notable takeaways from the week ending on June 3:

  • Nationally, traffic was up 3.8% when compared to the preceding week, while leases were down 5.2% The metropolitan statistical areas (MSAs) with the biggest WoW traffic increase was Dallas (22.5%). The MSA with the largest WoW decline in leases was Los Angeles (-21.9%).
  • The national occupancy rate stood at 92.83%. That represents a dip of 0.01% from the preceding week and a decrease of 1.69% when compared to the same time last year. The MSA with the largest WoW decrease was Miami (-0.47%).
  • The national leased percentage rate was 94.59%. That’s a WoW decrease of 2 basis points and a YoY drop of 1.37%. The MSA with the biggest WoW decrease was San Antonio (-0.52%).
  • The national net effective rent was $1,744. That’s down 0.4% from the preceding week and down 3.5% from the same time last year. Chicago experienced the largest WoW decrease (-3.5%).

Radix Weekly Data Report – May 13th

Traffic and Leases Move Up From Pandemic Low

It’s been two months since the initial lockdowns started across the country. This week, we saw a number of other states start to open up, and our industry is showing some positive signs in terms of some leading indicators.

On a national basis, both traffic and leases were up during the week ending on May 13, according to data from Radix. Specifically, traffic and leases were up 8.7% and 6.6%, respectively, week over week. They were down 41.7% and 18.2%, respectively, year over year. On the plus side, the YoY deficits for these two metrics have been dropping in recent weeks. For example, leases were down more than 50% on a YoY basis just four to five weeks ago.

Nationally, the occupancy rate dipped 11 basis points to 92.85% during the seven days ending on May 13 (it was down 139 basis points YoY). However, that was the smallest WoW decline since the start of April.

The accordion effect of these leading indicators is now showing signs of more significantly impacting net effective rent (NER).

In the week of May 13, we saw the largest WoW drop in NER – 1.1% – since the pandemic began. And, for the first time since the coronavirus came to the U.S., we saw the YoY comparison dip into negative territory at -0.8%.

What could all this mean?

We could be seeing the first signs of demand stabilization as leading indicators are improving and stabilizing.

The slow but constant gains in traffic and leasing are encouraging and we are making up for the huge deficits we saw when the lockdowns started. Occupancy and leased percentage are, for now, also showing signs of slowing decline.

If this trend continues, operators might not see the need to be as aggressive with concessions and price decreases, thus stabilizing NER. But macroeconomics will play the key role, and for now we are seeing few signs of slowing job loss, which undoubtedly will have a negative impact.

Data from the week of May 13 revealed two other notable takeaways:

  • Four metropolitan statistical areas (Chicago, Las Vegas, Orlando and Tampa) experienced slight WoW increases in occupancy.
  • Over half of the 21 MSAs tracked by Radix showed positive WoW leased percentage trends.

Radix Weekly Data Report – April 29th

Traffic and Leases Continue Week-Over-Week Improvements During Pandemic

As April drew to a close, most of the country was still in lockdown mode. But we have begun to see some states start to lift the restrictions they put in place five to six weeks ago.

And although most of us contend it will be a while before things return to normal – or something resembling our former days – new data from Radix shows that the apartment industry is finding its footing as it relates to the leading indicators of traffic and leases.

During the week ending on April 29, both traffic and leases increased on a national basis when compared with the preceding seven days. This was the latest in a series of week-over-week improvements for these stats after they reached a low point four weeks ago.

This trend suggests the worst may be over when it comes to these two metrics. As states continue to open, these numbers should continue to inch up, though most likely concessions and rent discounts will remain in order to attract prospects to properties.

With that being said, let’s get to the major takeaways from the week ending on April 29:

  • Traffic and leases were up 9.4% and 9.5%, respectively, WoW, but they were still down 51.2% and 29.4%, respectively, YoY. For context, it is worth remembering that leases were down 50% YoY just four weeks ago.
  • The national same-store occupancy rate stood at 93.27%. That’s down 0.11 percent from one week earlier and a full 101 basis points from the same time last year. The metros with the largest YoY declines were Orlando (-2.66%), San Diego (-1.94%) and San Francisco (-1.86%).
  • The national same-store leased rate was 94.69%, up 0.01% from the preceding week but down 1.03% YoY. The metros with the biggest YoY declines were Washington D.C. (-2.01%), Las Vegas (-1.69%) and San Antonio (-1.68%).
  • At $1,815, the average net effective rent in the U.S. was down 0.5% from one week earlier but was still 0.3% higher than it had been at the same time last year. That we could still see a positive YoY comparison after six weeks of a pandemic is a testament to the strong rent growth we have seen in the last decade in most markets.

I hope you continue to check our website as the pandemic continues, as I will be providing weekly updates of these stats. As always, I wish you, your families, your colleagues and your residents’ health and safety.