From today’s Times:
The once-sizzling housing market may be rapidly cooling, but not all residential property owners are worried – especially if they happen to own apartment buildings.
Landlords are enjoying booming times these days as more people are choosing to rent. Apartment vacancy rates are at five-year lows, averaging 5.6 percent nationwide.
Meanwhile, rents are up nearly 4 percent, on average, over last year, the biggest rise in six years.
As rents rise, so do the stocks of REITs in companies such as AvalonBay Communities and Archstone-Smith Trust.
Archstone-Smith built the recently-opened Archstone Boston Common, and Avalon Bay is big in the Boston (at Prudential Center), in Chestnut Hill, and in the suburbs.
These companies, and companies like them, are good investments, because they are some of the few suppliers ready to meet the demand from people priced out of the condo market.
Unfortunately, the hot rental market means higher rents for residents, as demand continues to outstrip supply.
It’s a Good Time to Be a Landlord – By Vivian Marino, The New York Times