The rise of apartment conversions

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Is 10-to-4 the new 9-to-5? link

• Traffic patterns are shifting, with morning and evening commutes down 12% and 9% respectively from 2019 levels. Midday trips have surged by 23%, indicating a rise in flexible work schedules across major cities.

• The US saw 72 million car trips around noon, matching the volume of evening rush hour traffic, as more workers only commute when necessary. This has led to a "midday rush hour" replacing traditional peak hours.

• Congestion cost the US over $70 billion in 2023, with New York drivers hit the hardest, losing 101 hours to delays. This highlights the significant financial and time burden caused by traffic.

The rise of office-to-apartment conversions link

• Office vacancies hit nearly 22% in Q1 2024, pushing cities like Alexandria, Virginia, to adopt office-to-apartment conversions. This trend is helping ease the nationwide housing shortage while repurposing outdated spaces.

• Conversions are more cost-effective than new construction, as they reduce materials, labor, and time. This also makes the projects more sustainable by cutting down on waste, emissions, and energy use.

• Challenges include adding natural light, soundproofing, and modern amenities, but well-located buildings near retail and restaurants have higher appeal. The case study in Alexandria involves converting a 200,000 sq ft office building into 200 luxury apartments.

Weekly housing trends view—data for week ending Aug. 31, 2024 link

• Median listing prices have been falling, with a 0.9% year-over-year decrease for the 14th consecutive week. This marks the highest share of price reductions in August in over five years.

• New listings grew by 5.5% compared to last year, driven by declining mortgage rates. However, most sellers may wait until spring 2025 when rates are expected to drop further.

• Active inventory has increased by 34.6% year over year, but it remains below pre-pandemic levels. Homes are staying on the market six days longer than last year, giving buyers more time to decide.

Mortgage refinance demand is 94% higher than a year ago, as interest rates fall again link

• Mortgage refinance applications rose 94% compared to last year, reflecting the ongoing decline in interest rates, which dropped to 6.43% for 30-year fixed loans. However, refinance applications still dipped slightly by 0.3% last week.

• Mortgage applications for home purchases increased by 3% this week, although they remain 4% lower compared to the same period last year. High home prices continue to dampen demand, even with lower rates.

• Government loans such as FHA and VA, offering low or no down payments, are gaining traction among lower-income buyers. These loans contributed to the overall rise in purchase applications.

St. Louis commercial real estate in few graphs link

• St. Louis' unemployment rate in July 2024 was 4.6%, 30 basis points higher than the national average of 4.3%. Job growth was mostly in education, health services, government, and hospitality, accounting for 88.4% of gains in the metro.

• Multifamily properties in St. Louis underperformed, with effective revenue declining by 2.1% in the past 12 months, compared to a 1.0% drop in the Midwest and 1.6% nationwide. The city's excess supply to inventory ratio of 1.13% was 11th highest among 82 markets.

  

• Class BC office vacancies in St. Louis hit an all-time high of 27.1%, 680 basis points above the national average. Vacancy rates for these properties rose by 5 percentage points since 2019, highlighting a major underperformance.

Market Insights | U.S. Industrial Q2 2024 link

Where industrial stands in the current cycle

Top Cities Where Renting Is Cheaper Than Buying A Starter Home

This town in South Carolina is experiencing a population surge

Top 10 cities near Dallas to live in ↓

Charted: Nation’s Tightest Real Estate Markets →

The top B-schools for career growth link

• Stanford ranked first on LinkedIn's Top MBA Programs list, moving up from second place in 2023. Harvard fell to third, and INSEAD made its debut due to the list expanding globally.

• The ranking includes 58 MBA programs in the Americas, 29 in Europe and the Middle East, and 13 in Asia. This expansion reflects a broader look at global business education.

• LinkedIn data shows a 25% rise in senior leaders and a 45% increase in entrepreneurs hired with MBAs since 2010. The degree remains highly valuable in a shifting business environment.

This "covered bridge" house in Vermont

Link to the listing

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Vidit

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