I have several questions. Thanks in advance for any input.
1. How long will it take for all of the new housing to become occupied at acceptable rates?

2. Will rental rates drop in the new properties to the point it will effect the older properties?

3.Is it reasonable to think at some point properties that are leveraged will be highly motivated to sell?

I think rates have already been effected

Rents in the new luxury high rise apartments are dropping due to low occupancy. Students in old rental houses can now afford to upgrade to the high end apartments. Lots of open student home rentals available as a result. My guess is two years for the market to catch up with the available inventory.

I think property types will be the most important aspect in terms of staying leased. In loose order of most insulated to most exposed. One and two bedroom homes and duplexes anywhere in decent areas. 3 bedrooms close to campus. "Affordable" homes in safe areas. 3 bedroom homes anywhere in town, 3 bedroom duplexes, 1 and 2 bedroom apartments, 4 and 5 bedroom houses, 4 and 5 bedroom duplexes, 3+ bedroom apartments. I'd be worried if I owned much of the last three on the list.

As Ive said before, quality property management can go a long ways in beating the competition. I'm looking at an 85% renewal rate this year. Good communication is the #1 factor.

And any of you willing to lower rent for an extended lease with a young family let me know.

Our current lease goes through July 2020, but we will likely look at moving at that point. In an older house right now (which has its issues), and looking for a more favorable school district (aka not really looking for the typical ag shack).

Markets like B/CS are slow to react and even slower to correct.

Even being overbuilt, if a developer can come in and build a brand new luxury apartment complex and make enough money off their developer fee alone to be profitable in comparison to other hot markets, and if equity is available at that return level, the project is going to be built. It doesn't matter what happens and how low occupancy gets after the property changes hands and becomes old news.

Here's current Vacancy




And here's rent growth



Data from CoStar

Thank you for sharing this information.

Just to be clear, that data is mostly apartments. Single family homes being rented out would not be included in it.

histag10 said:

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And any of you willing to lower rent for an extended lease with a young family let me know.

Our current lease goes through July 2020, but we will likely look at moving at that point. In an older house right now (which has its issues), and looking for a more favorable school district (aka not really looking for the typical ag shack).

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What is your price point? I have a resident with a 3 year lease in my rent house near campus and he is moving June 2020.

We're currently paying $1250 for 2200 sqft (pretty great deal- but again, older house with it's own issues).

We'd be willing to go up to maybe $1500 if house is energy efficient and is zoned to a different elementary (currently zoned to South Knoll)

We'd be moving with 2 large elderly dogs (given that they are still alive at that point ) a toddler, and a baby.

histag10 said:

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We're currently paying $1250 for 2200 sqft (pretty great deal- but again, older house with it's own issues).

We'd be willing to go up to maybe $1500 if house is energy efficient and is zoned to a different elementary (currently zoned to South Knoll)

We'd be moving with 2 large elderly dogs (given that they are still alive at that point ) a toddler, and a baby.

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My rent house zoned to South Knoll.
But is has been gutted and renovated and has a dog door.

dubi said:

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histag10 said:

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We're currently paying $1250 for 2200 sqft (pretty great deal- but again, older house with it's own issues).

We'd be willing to go up to maybe $1500 if house is energy efficient and is zoned to a different elementary (currently zoned to South Knoll)

We'd be moving with 2 large elderly dogs (given that they are still alive at that point ) a toddler, and a baby.

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My rent house zoned to South Knoll.
But is has been gutted and renovated and has a dog door.

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The majority of the house we are in has been gutted and renovated. One of our biggest issues is the windows. The windows are extremely old, and really dont help with energy efficiency (I dont understand why they havent been updated - they updated the AC & heat to a brand new system).

What street is the house on, if you dont mind me asking? South Knoll isnt horrible, and we might consider it - it just wouldnt be our first choice.

Email in profile.

The windows and doors have all been replaced.

Sent

I think we have not seen the bottom of the rental property problems yet. Still a ton of units being added to the market. An easy search on realtor or zillow of rentals will show you this. I looked the other day and I think there were 1300 places listed for rent. Two or three years ago that search would yield about a third of that available. I think we have at least two years of decline left, and you will see more and more people selling or forced to sell between now and 3 or 4 years from now. I don't think we will see rental pricing, demand, and profitability where it was for at least 10-15years. If you already own stuff and bought it right, you are in good shape. At current or even recent pricing, its tough sledding. Just my feel for things.

OP, if you ask because you are looking to buy and live in the home, there are more coming on the market in the southern ''middle" of town. Some of those neighborhoods/streets are deed restricted (if any are rentals they must be single family occupants) but even the ones that aren't are going on the market due to some oversaturation.
Makes sense (from a college student p.o.v.) because there are nicer options closer in, and makes sense (from a investor p.o.v.) as the taxes haven't decreased while the place sits empty. The landlords that have long term tenants are doing fine, but the folks that didn't really think it through beyond, "hey lets rent it out instead of selling," are perhaps regretting that decision.
What we saw on our street alone were three new families with small children move in and we were so happy to greet them because our street is a blend of resident ages from newborn to retiree.