Student Housing Pre-Lease Rate Reaches All-Time High

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Rates are on the rise link

The average 30-year fixed mortgage rate has increased to 6.77%, up from last week's average of 6.64%. This time last year, the rate stood at 6.32%. Similarly, the average rate for a 15-year fixed mortgage has risen to 6.12%, compared to 5.90% last week and 5.51% a year ago.

Opportunity Zone Housing Markets Still Tracking Along with Broader U.S. Housing Market link

• Median home values in over half of the Opportunity Zones decreased in Q4 2023, mirroring broader U.S. market trends. Prices fell in 52% of zones, aligning with national patterns of a cooling housing boom.

• Opportunity Zones, targeted for economic redevelopment, continue to attract buyer interest despite market downturns. These areas slightly outperformed other neighborhoods in price resilience during the last quarter.

• The disparity in home values persists, with 79% of Opportunity Zones having median sales prices below the U.S. median of $333,000 in Q4 2023. Prices remained under $200,000 in 51% of these zones, highlighting ongoing affordability challenges.

Homeowners Today Stay in Their Homes Twice As Long As They Did in 2005, link

• Homeowner tenure in the U.S. has significantly increased, with the typical homeowner now staying in their home for 11.9 years, up from 6.5 years two decades ago. This change is largely attributed to older Americans aging in place and the challenges of finding and affording new homes.

• The peak of homeowner tenure was 13.4 years in 2020, influenced by the pandemic-induced moving frenzy. Since then, there has been a slight decline, but the trend of longer tenure contributes to the inventory shortage and rising home prices.

• California homeowners have the longest tenure, often staying in their homes for over 17 years, partly due to state property-tax incentives like Proposition 13. In contrast, homeowners in more affordable southern metros like Louisville, KY, and Nashville, TN, move more frequently, with median tenures as low as 7.4 years.

Student Housing Pre-Lease Rate Reaches All-Time High in January link

• January 2024 set a new record for student housing pre-lease rates at 49%, the highest ever for this time of year, surpassing January 2023's rate by approximately 80 basis points. This indicates a growing demand for student housing near universities.

• The closest properties to campus, within a half mile, achieved the highest pre-lease occupancy at 49.5%. This demonstrates a clear preference among students for living closer to their universities, despite varying rent increases based on proximity.

• Rent for student housing for Fall 2024 increased by an average of 6.7% from the previous year, with the most significant hikes seen in properties more than one mile from campus at 8.7%. Although these increases are above pre-COVID norms, they represent a slowdown from the 9%+ gains seen during the Fall 2023 pre-lease season.

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