Housing Markets with Biggest Quarterly Increases in Profit

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There's no such thing as wealth without risk.

— John C. Bogle

New Report: Strongest rent increase in 20 months link

• The U.S. multifamily market showed the strongest rent increase in 20 months, with an average asking rent up by $8 to $1,721 in March, reflecting a 0.9% year-over-year rise. This gain is significant, as it signals a return to more normal seasonal patterns following the anomalous trends induced by the 2020 pandemic lockdowns.

• Notably resilient metros include Orlando and Charlotte, where significant stock expansions have coincided with rising rents. For instance, Orlando experienced a rent increase of 1.4% alongside a supply growth of over 4% in the past year, demonstrating robust demand despite increasing supply.

• Renewal rent growth continues to slow, with a national increase of 4.6% year-over-year in January, significantly below the peak seen in May. The highest renewal increases were noted in Indianapolis at 8.0%, San Diego at 7.8%, and Orlando at 7.7%, showing strong local market dynamics despite the overall slowdown.

Top 10 Housing Markets with Biggest Quarterly Increases in Profit Margins in Q1 2024 link

• Profit margins on median-priced homes in the US dropped to 55.3% in Q1 2024, the lowest in over two years. This decline from 57.1% in Q4 2023 reflects a significant market cooling.

• Despite the overall decline, 63 metro areas saw annual increases in profit margins, with Peoria, IL, and Scranton, PA, showing the most substantial gains. These areas experienced increases up to 52.8% and 106.5% respectively.

• The top 10 metro areas with the largest quarterly profit margin increases include Ocala, FL, and Punta Gorda, FL, with margins rising to 128% and 103.1%. These regions highlight localized market strength despite broader national trends.

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Nation-Leading Apartment Supply Coming Online in Florida link

• Florida leads in new apartment growth nationally with approximately 66,000 units added, capturing more than 13% of the U.S. market share in one year. This surge ranks Florida second only to Texas in terms of new apartments.

• In the Florida market, the local housing stock grew nearly 4%, driven by significant contributions from Orlando, Tampa, and Jacksonville. Orlando alone added over 12,900 units, leading the state's supply increase.

• The broader region sees competitive expansion, with the Carolinas leading at a 4.7% growth rate and the Mountains/Desert region following at 4%. These figures highlight the aggressive expansion trends in apartment markets across various U.S. regions

Home Prices Stagnate in Florida and Texas as Supply Soars link

• In March, regions like Cape Coral and North Port in Florida saw their housing supplies jump by approximately 50%, the highest increase in the U.S. This boom is largely due to continuous home building during the pandemic.

• An influx of new listings and slow buyer demand—aggravated by high home prices and an insurance crisis in Florida—are causing homes to linger on the market longer. Sellers are frequently forced to reduce their asking prices to attract offers.

• The Federal Reserve indicates that high interest rates may persist longer than anticipated, affecting the affordability of homes and contributing to a sluggish market. The average 30-year fixed mortgage rate stood at 6.82% in March, the highest since December.

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That's all, folks.

Cheers,

Vidit

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