OAKLAND, Calif., May 16, 2008 — Wavering economic conditions are expected to dampen fundamental growth in the East Bay apartment market this year; however, low housing affordability should support demand and allow for modest revenue gains, according to a first-quarter Apartment Research Report by Marcus & Millichap, the nation’s largest real estate investment services firm. Demand for high-quality assets remains strong, though buyers are expected to proceed with caution in the months ahead, particularly in lower tiers.
“Demand growth could pick up momentum later this year, as an increasing number of companies based in neighboring Bay Area markets have decided to relocate to the less-expensive Oakland metro,” says Jerry C. Smith, regional manager of the Oakland office of Marcus & Millichap.
Following are some of the most significant aspects of the Oakland Apartment Research Report:
Builders are forecast to deliver approximately 1,700 rental units in 2008.
Vacancy is projected to end the year at 5.5 percent.
Asking rents are expected to rise 3.7 percent to $1,410 per month.
Effective rents will gain 3.7 percent to $1,339 per month.
The government sector led the metro in employment expansion during the 12-month period ending in the first quarter, adding 5,200 jobs for a gain of 2.8 percent.
For a copy of the complete Oakland Apartment Research Report, as well as reports on other markets nationwide, visit our website at www.MarcusMillichap.com.
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