Top 10 cities for rental activity

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Is home construction entering a slowdown? link

• Single-family housing completions rose 16.8% year over year, but permits fell 7.7% and starts dropped 4%, signaling fewer homes coming online soon. Builders face ongoing challenges with high costs and labor shortages.

• Regionally, the Northeast saw a 28.7% monthly decline in starts but a 9.8% year-over-year increase, while the South experienced a 10.2% monthly drop. Meanwhile, the Midwest and West posted slight gains of 4.6% in September.

• Builders are cautiously optimistic due to possible regulatory relief under the new administration, with builder confidence climbing in recent months. However, potential tariffs and immigration restrictions could worsen labor shortages and raise material costs.

Trump’s tariffs may have little impact on new-home prices link

• Nearly 10% of residential building materials are imported, with Canadian lumber and imported fixtures being key components. Tariffs could raise costs but are unlikely to cause significant price hikes due to supply chain shifts and domestic production for many materials.

• Builders cite high interest rates and supply chain bottlenecks as far greater challenges to affordability than potential tariff impacts. For instance, delays and financing costs affect prices more significantly than the cost of optional imported upgrades like countertops.

• Many builders have already diversified supply chains, sourcing materials from countries with fewer tariff risks. Nations like Mexico, Malaysia, and Indonesia now play a larger role in providing fixtures, reducing reliance on China.

Health and wellness boom reshaping CRE

• Hybrid work and post-pandemic priorities are driving demand for wellness-oriented real estate. Class-A buildings with fitness centers, outdoor spaces, and health-driven amenities are commanding premium rents.

• Active adult communities and luxury hospitality are adopting health-focused features, from pickleball courts to neurocognitive treatments. Mixed-use developments are blending wellness amenities like healthy food halls and boutique fitness into their designs.

• The U.S. wellness market is valued at $480 billion and growing 5-10% annually, while the global market reached $6.32 trillion in 2023. North Americans spend over $5,000 annually on wellness, influencing commercial real estate trends significantly.

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Top 10 cities for rental activity link

• Washington, D.C., topped RentCafe's list of sought-after rental markets, driven by its public transit, healthcare, low unemployment, and quality of life. Rental availability in D.C. dropped 3% year-over-year, reflecting quick decision-making by renters.

• Minneapolis saw saved apartment searches jump 18%, even as listings fell by 8%, signaling renter indecision. Cleveland gained popularity due to its affordability, with rents 30% below the national average and a 9% decline in listings.

• The South dominated with 14 of the top 30 rental markets, led by cities like Atlanta and Hialeah, FL, while the Midwest held nine spots. The Northeast had only Philadelphia in the top 30, while Los Angeles led six Western cities in popularity.

• click on the link to see the rest of the list

Apartment inventory growth to top 8% in Charleston link

• Charleston's apartment inventory is set to grow by 8.3% by Q1 2025, marking the highest annual increase recorded in 24 years. This spike is 75% higher than the market's five-year average growth rate of 4.7%.

• From Q3 2014 to Q3 2024, Charleston’s existing apartment base surged by 57%, driven by job and population growth. Over the past five years alone, inventory expanded by over 26%.

• Job growth in Charleston-North Charleston ranks among the top 10 U.S. metros, with a 4.2% increase in the year ending September 2024. Population also rose 8% between 2017 and 2022, fueling housing demand.

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Vidit

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