CST: 28/07/2016 16:03:41   

U.S. Residential Property Vacancy Rate Drops 9.3 Percent Between Third Quarter 2015 and First Quarter 2016

168 Days ago

San Jose Tops List of Five Metros With Lowest Vacancy Rates; Flint, Michigan, Tops List of Five Metros With Highest Vacancy Rates

IRVINE, CA --(Marketwired - February 11, 2016) -  RealtyTrac® (www.realtytrac.com), the nation's leading source for comprehensive housing data, today released its Q1 2016 U.S. Residential Property Vacancy Analysis, which shows that out of nearly 85 million residential properties (1 to 4 units) nationwide, more than 1.3 million (1.6 percent) were vacant at the beginning of February 2016, down 9.3 percent from the last residential property vacancy analysis in the third quarter of 2015.

The analysis used RealtyTrac's publicly recorded real estate data -- including foreclosure status (zombie foreclosures), owner-occupancy status, and equity -- matched against monthly updated vacancy data from the U.S. Postal Service.

"With several notable exceptions, the challenge facing most U.S. real estate markets is not too many vacant homes but too few," said Daren Blomquist, vice president at RealtyTrac. "The razor-thin vacancy rates in many markets are placing upward pressure on home prices and rents. While that may be good news for sellers and landlords, it is bad news for buyers and renters and could be bad news for all if prices and rents are inflated above tolerable affordability thresholds."

Top 5 Most Vacant U.S. Cities (view infographic)

             
MSA   ALL Residential Properties   Vacant Properties   Vacancy Rate
Flint, MI   154,137   11,605   7.5%
Detroit-Warren-Dearborn, MI   1,539,609   81,190   5.3%
Youngstown-Warren-Boardman, OH-PA   156,861   6,979   4.4%
Beaumont-Port Arthur, TX   124,939   4,695   3.8%
Atlantic City-Hammonton, NJ   112,765   4,191   3.7%
             

Among 147 metropolitan statistical areas with at least 100,000 residential properties, those with the highest share of vacant properties were Flint, Michigan (7.5 percent), Detroit (5.3 percent), Youngstown, Ohio (4.4 percent), Beaumont-Port Arthur, Texas (3.8 percent), and Atlantic City, New Jersey (3.7 percent).

Other major metro areas with vacancy rates above the national average included Indianapolis (3.0 percent), Tampa (2.9 percent), Miami (2.8 percent), Cleveland (2.8 percent), and St. Louis (2.6 percent).

"Across the Ohio markets, occupancy demand is fueling a robust seller's market for residential and commercial real estate," said Michael Mahon, president at HER Realtors, covering the Ohio markets of Dayton, Columbus and Cincinnati. "With vacancy rates low, situations such as leasebacks and delayed occupancy are factors of concern in trying to get timing aligned for possession transfer in many communities. Couple this demand with the added necessary timing factors of the new Federal TRID disclosure process for 2016, and there is an even more heightened need for clear and consistent communication between buyers and sellers involving the timing and expectations of possession transfer regarding real estate transactions."

Top 5 U.S. Cities Running out of Rooms (view infographic)

             
MSA    ALL Residential Properties    Vacant Properties   Vacancy Rate
San Jose-Sunnyvale-Santa Clara, CA   443,387   858   0.2%
Fort Collins, CO   105,876   246   0.2%
Manchester-Nashua, NH   117,729   342   0.3%
Provo-Orem, UT   131,449   397   0.3%
Lancaster, PA   148,177   457   0.3%
             

Metro areas with the lowest share of vacant properties were San Jose, California (0.2 percent), Fort Collins, Colorado (0.2 percent), Manchester, New Hampshire (0.3 percent), Provo, Utah (0.3 percent), Lancaster, Pennsylvania (0.3 percent), and San Francisco (0.3 percent).

Other major metro areas with vacancy rates below the national average included San Francisco (0.3 percent), Los Angeles (0.4 percent), Boston (0.5 percent), Denver (0.5 percent), and Washington, D.C. (0.5 percent).

"Due to Seattle's growing economy, high in-migration, and limited housing supply, it's no surprise that our market has a low number of vacant homes relative to the national average," said Matthew Gardner, chief economist at Windermere Real Estate, covering the Seattle market, where the overall vacancy rate of 0.9 percent and the investment property vacancy rate of 2.4 percent were both more than 40 percent below the national average. "This is also true as it relates to investment property vacancies. Rents across the board are rising in Seattle, but single family home rentals in some areas are providing a more affordable option to traditional apartments.

"When considering the number of so called, 'zombie foreclosures' in Seattle, the reason for the slightly elevated level is due to the fact that banks continue to 'cherry-pick' which homes go to the front of the line when pursuing foreclosure proceedings," Gardner continued. "In a market where values are increasing, these will be the homes that have regained positive equity. In aggregate, I anticipate that the level of zombie foreclosures in Seattle will continue to drop to historic average levels."

Investment properties account for three-quarters of all vacant homes

Investment properties accounted for 76.7 percent (1,044,599) of all vacant properties nationwide. Among metro areas with at least 100,000 residential properties, those where investment properties accounted for the highest share of vacant homes were Myrtle Beach, South Carolina (95.0 percent), Barnstable, Massachusetts (93.5 percent), Salisbury, Maryland (91.9 percent), Lexington, Kentucky (91.8 percent), and Asheville, North Carolina (90.6 percent).

The report also found that investment properties are more likely to be vacant (4.3 percent vacancy rate nationwide), but investment property vacancy rates are 3 percent or below in more than one-third of U.S. markets -- good news for landlords but bad news for renters in those markets.

Among metro areas with at least 100,000 residential properties, those with that highest share of vacant investment properties were Flint, Michigan (23.1 percent), Detroit (15.1 percent), Youngstown, Ohio (11.4 percent), South Bend, Indiana (10.9 percent), and Indianapolis (10.8 percent).

Metro areas with the lowest share of vacant investment properties were Fort Collins, Colorado (0.6 percent), San Jose, California (0.7 percent), Fayetteville, Arkansas (0.8 percent), Provo, Utah (0.9 percent), and San Francisco (0.9 percent).

Vacant "zombie" foreclosures down 4 percent nationwide, up in a minority of markets

Properties in the foreclosure process accounted for 1.5 percent (19,793) of all vacant properties nationwide, but the number of these "zombie" foreclosures was down 4 percent from a year ago when there were 20,575 nationwide.

States with the biggest increase in zombie foreclosures from a year ago included Massachusetts (up 167 percent), Oklahoma (up 89 percent), Michigan (up 71 percent), Arizona (up 52 percent), and New Jersey (up 49 percent).

Metro areas with the biggest increase in zombie foreclosures from a year ago included Worcester, Massachusetts (up 163 percent), Providence, Rhode Island (up 148 percent), Boston (up 111 percent), St. Louis (up 108 percent), and Detroit (up 71 percent).

Metro areas with the biggest increase in zombie foreclosures from a year ago included Worcester, Massachusetts (up 163 percent), Providence, Rhode Island (up 148 percent), Boston (up 111 percent), St. Louis (up 108 percent), and Detroit (up 71 percent).

Methodology

RealtyTrac matched its address-level property data for nearly 85 million U.S. residential properties -- including foreclosure status, owner-occupancy status, and equity -- against monthly updated data from the U.S. Postal Service indicating whether a property had been flagged as vacant by the postal carrier. Only metropolitan statistical areas with at least 100,000 residential properties were included in the rankings.

About RealtyTrac

RealtyTrac is a leading provider of comprehensive U.S. housing and property data, including nationwide parcel-level records for more than 130 million U.S. properties. Detailed data attributes include property characteristics, tax assessor data, sales and mortgage deed records, distressed data, including default, foreclosure and auctions status, and Automated Valuation Models (AVMs). Sourced from RealtyTrac subsidiary Homefacts.com, the company's proprietary national neighborhood-level database includes more than 50 key local and neighborhood level dynamics for residential properties, providing unrivaled pre-diligence capabilities and a parcel risk database for portfolio analysis. RealtyTrac's data is widely viewed as the industry standard and, as such, is relied upon by real estate professionals and service providers, marketers and financial institutions, as well as the Federal Reserve, U.S. Treasury Department, HUD, state housing and banking departments, investment funds and tens of millions of consumers. 

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