SW Idaho NARPM just released their 2nd quarter vacancy report for the Treasure Valley. It is showing the average vacancy being at 3.5% which is still low compared to the last recorded national average which is at 7%. Currently FRPM has a vacancy of 2.5%. We are seeing the single family home vacancy going down from quarter 1 and the multi family has gone up slightly. I feel that the time of year is the major factor in these changes from quarter 1. Summer is a very popular time to move and all though it creates a slightly higher vacancy it is also the key time to get peak rents. This report also shows that rents are still up and holding steady. FRPM still considers this a win for investors because despite the slightly higher vacancy, properties are still getting pre-leased prior to tenant moving out and we are still getting great rent amounts.
Read full report here: SW Idaho NARPM Quarter 2 Vacancy
Melissa Sharone, President
For weeks we've seen some signs that the rental market is softening to a more traditional rental market. We're over a month away for SW Idaho's NARPM 2nd quarter rental market analysis report, but we suspect we'll see increased vacancies and lower rents.
We're seeing longer days on market which increases vacancy. Rents are also being challenged and most landlords are opting to offer move-in credits over rent decreases. Other than filling new construction, move-in-credits have been something in the past. Move-in credits are the preferred approach as they protect the price point for renewals and other similar units that were just rented months prior at the same or higher rent. However, FRPM has done some testing and we are seeing a lower rent price point is converting better than the move-in specials.
For years Boise Landlords have been rewarded by being a bit aggressive with rents, but for the moment, FRPM is not recommending an aggressive approach. This could change in a month or two, but for now, FRPM is recommending that Landlords focus on rents to reduce days-on-market and lost rent.
Please take a moment to read the article that was recently published by Kristen Curtis in the residential resource. It features the importance of having good solid lease procedures when taking on inherited tenants. Kristen has done a great job of implementing these procedures here at First Rate and it definitely helps the transition of gaining inherited tenants go much smoother.
The most recent Swope Investment Properties Newsletter has some great articles for property investors that I wanted to pass on to our blog readers.
Page One: Stacy McBain provides a great summary of what to expect from the Ada County Assessor regarding value increases. She also summarizes the process for appealing assessed property values as well as some of the factors used in assessing investment properties.
Page Two: Eric Uhlenhoff describes how putting emphasis on "market" rents, could be the way to go due to a large disparity from actual rents to projected rents within MLS listings. So long as projected rents fall within market, this certainly is sound advice.
On the bottom of page two is an invitation to the AVID Investors Club. This club has been growing and has proven to be a great resource for investors. Members not only learn more about the real estate investment and rental market, but are also making great connections. For example, an AVID member helps facilitate a hard money loan for a property owner.
Page Three: I share an update to one of the metrics I track for Ada County 4 plexes showing how Gross Rent Multiplier has spiked and what this does to value.
Also on this page, Mary Nelson explains the advantage of working with a small brokerage who focuses on personal service. I have worked the opposite side of real estate transactions where the other side is a team and I tend to view it as an assembly line process. The product passes through several hands before final assembly, which works great when producing widgets.
To subscribe to these newsletters, please contact Shane Brown at email@example.com or 208-501-4000.
After posting the NARPM 1st quarter vacancy last week, we wanted to take a minute to share FRPM's 1st quarter vacancy results for 2017.
The overall average for FRPM was .53%. This is for multifamily and single family homes. This continues to be a record low for the past 5 years. Below is a graph with the 1st quarter vacancy for 2013-2017. The orange line represents the vacancy for 2017. As you can see the trend of low vacancy is still going strong.
The SW Idaho Chapter of NARPM (National Association of Residential Property Managers) just released their 1st quarter vacancy survey . The overall average vacancy is 3.7% which is considerably lower than the last recorded national average of 6.9%.
The results that are graphed below break down the vacancy between counties in SW Idaho as well as multifamily compared to single family. As you can see the multifamily for Ada county is currently sitting at 5% and the single family at 2.5%. For Canyon county the rates are at 2.9% for multifamily and 3.5% for single family. We are starting to see the vacancy rise slightly due to the time of year but these results as well as FRPM's vacancy are still at almost a record low for the past 3 years. These numbers are still allowing rents to increase, which is keeping the market strong.
To read full report click here. NARPM 1st quarter 2017 vacancy survey
According to economists, the rental market will continue to grow and be strong for at least the next ten years. The fastest growing segments of the US population (minorities, millennials, and singles) are choosing to rent. Why? Some point blame to the lack of consumer confidence following the crash of the real estate market. The amount of foreclosures depressed the home ownership rates. Other contributors:
1. Population segments that prefer to rent:
- Minorities, which is the fastest growing segment of population
- Singles, are fastest growing portion of households
- Millennials, with high costs for advanced schooling, they are staying single and delaying homeownership
2. Household growth:
- Long term: We will add 13.6 million households by 2025 and an additionally 11.5 by 2035
- Minority growth rates higher than whites
- Advanced schooling and delayed marriage have delayed independence among young adults
- Millennials form 33 million household by 2035
3. Homeownership rates
- Declined from 69.2% (2004) to 63.7% (2015).
- Declined from 69.3% to 58.5% for ages 25-44
- Projected to continue to decline with an average of 60.6% in year 2035
4. Economic forecast
- Expect continuation of economic and employment growth with moderate interest rates and inflation
- Population changes and household formations should favor renting over home ownership into the near future.
This information is an update from the blog that was posted yesterday.
Over the past few years we have frequently discussed the concerns of the growing number of apartments being built in the Boise and surrounding areas. Severally years ago we were really concerned that the supply would not meet the demand. We were additionally concerned that the rising rents were not sustainable. First Rate Property Management does not mange in Nampa, Caldwell, Kuna, Garden City, or Star, so we can't really don't feel comfortable forecasting in those cities. In Boise and Meridian, however, the population growth, increased jobs, and higher wages have contributed to the demand to rent, which has kept up with the increase in supply and rents.
Below is an update on projects that have been completed, are in progress now, and in the planning stages. That’s a lot of units. We believe it will continue to be important to watch the vacancy and rent statistics for any trends.
We just completed week 7 for our vacancy tracking in 2017 and things are looking great. We are currently at a record low of .3% and the trend of low vacancy looks promising in the weeks to come. The market continues to allow FRPM to raise rents with most renewals. The renewal increases are supporting even higher rent on a property that has been turned over. FRPM is also keeping consistant with getting 90% of properties that are on notice re-rented with in 17 days, which is 13 days prior to them becing vacant. The market continues to remain on the strong in the Boise Area.
Our 2017 vacancy chart is below
On a February 9th blog post, Park Place Property Management listed the top 5 management companies in the Boise area, which listed First Rate Property Management as #1. As they explained in their opening paragraph, investors need to be well informed and educated when it comes to choosing the right property management company for them. FRPM can not agree more. Investors need to interview property managers and choose the one that is the best fit for them. For example, FRPM only manages in the Boise, Meridian, and Eagle areas and an investor that we had been working with recently identified a single family rental in Kuna. So we referred them to one of our fellow colleagues.
Its an honor to be ranked #1, but even greater, is to see the industry leaders acknowledging that with the growth of the Boise and Meridian areas, landlords have many options and should do their homework and select the right property manager. We’ll take it even one more step and suggest that renters also do their own research before choosing a rental. Below is the full blog post from PPPM.
Who Are The Best Property Managers?
As Idaho’s largest, professional management company, we are continually expanding our portfolio of over 4,000 rental units throughout the Boise, Meridian, Nampa, Caldwell, and other surrounding areas, and are always excited to be meeting new real estate investors.
Our experience over the past decade managing properties throughout the Treasure Valley has given us a unique perspective on the competitive landscape and has helped up work towards becoming the best property management company. We consider ourselves close friends with many of Southwest Idaho’s other leading property management companies. We want our potential clients to be as well informed and educated as possible when it comes to choosing the right property management company for them. We have the utmost respect for our local competitors/colleagues and we are happy to provide our own list of Southwest Idaho’s Top Property Management Companies:
1. First Rate Property Management: Over 20 years, First Rate Property Management has become the Boise based property management company that it is today, all from referrals. Their largest source of referrals are from their very own clients. Why? Because unlike most other companies, they are investors too. Their client’s real estate investments perform well and because of that, they tell all of their friends and family to invest in Boise.
2. Realty Management Associates, Inc: Realty Management Associates, Inc., CRMC® (RMA) has been in the business of management of single-family homes and small apartment properties since 1980. RMA has maintained a history of solid, long-term client relationships throughout Boise, Nampa and surrounding areas.These relationships were built on sound property management skills, owner communication, tenant solicitation and screening, maintenance supervision, and comprehensive accounting practices.
3. Bolton Property Management: Bolton Property Management is a comprehensive property management company serving communities throughout Idaho and Utah. They are dedicated to providing superior services that consistently exceed client’s expectations through Industry, Integrity, and Innovation.
4. Chapman Properties: The Chapman family has devoted the last 20 years in developing their expertise in the business of managing people and property in the Ada and Canyon County areas. They focus on exceptional management of homes, condos, and townhomes. Chapman Properties is a family owned and operated business and plans to continue this legacy for many years to come.
5. Boise Property Management: Boise Property Management offers both landlords and residents a professional experienced staff with unrivaled quality and property management services in the Treasure Valley. Their services include property management for Residential Homes, Duplex, Tri-Plex, Four-Plex and Multi-family Apartment Communities. In addition to their property management services, they also have an exclusive property maintenance division dedicated to rentals maintenance and repair needs.
We commend all these great companies for being active members of NARPM (National Association of Residential Property Managers) and IREM (Institute of Real Estate Management).
If you are shopping elsewhere for the best property management companies to help with your investment needs in the Boise, Meridian, Nampa, and surrounding areas, consider getting quotes from any of these 5 great companies. We are always available to help you or your clients make the best decision for your investments.
- Boise Area Rental Market
- Property Management
- Boise Area Real Estate Market
- Boise Real Estate Market
- Boise and Idaho in the News
- Deferred property maintenance
- Rental Property Maintenance
- Fair Housing
- Quarter 2 Vacancy Information
- We're Calling it: Rental Market Softens
- Procedures for Inherited Tenants
- Swope Investment Properties Investor Newsletter
- FRPM 1st Quarter Vacancy
- Melissa Sharone
- Tony Drost
- Kristen Curtis
- Tyler Brown
- Tara Pecora
- Marie Swanson
- Lizz Loop