Some areas of the country are growing exponentially faster than others. Where some cities have “For Rent” signs up almost continuously, other cities don’t even have time to plant a sign in the ground — the property is already rented.
In a study* out today, RealtyTrac took publicly recorded real estate data and compared it with monthly updated vacancy data from the U.S. Postal Service to come up with the Top 5 Most Vacant Cities, and the Top 5 Most Occupied Cities in the United States.
Top 5 Most Vacant Cities
In a result that should surprise no one, Flint, MI and Detroit, MI rank #1 and #2 on the list of most vacant cities — and the recent lead-in-the-water crisis hasn’t even had time to affect the vacancy rate. Looks like Josh called Detroit.
Top 5 LEAST Vacant Cities
For anyone who has been paying attention to real estate, the first city on this list is a no-brainer. San Jose — home to Google, Apple, Facebook, and all those other tech companies whose websites you use every day — tops the list of places where there is no vacancy.
I have a friend who lives in San Francisco, and any time there is an apartment advertised for rent, hundreds of people show up with cash in hand in the hopes they can get a place to live.
Second on the least vacant cities may come as a surprise — Fort Collins, CO. I am not at all surprised by this because Fort Collins is a delightful college town in the foothills of the Rocky Mountains. I just helped a retail client buy a house in the city (we close on Friday), and every single time we went to see a house, I would get a note from the listing agent letting me know they already had 2, 5, or 11 offers on the property, so if we wanted to make an offer, we needed to do it that night.
One important statistic to note is that with almost 85 million residential properties nationwide, the vacancy rate is down 9.3% from Q3 2015.
“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.”
*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.
Investors: Do any of these statistics surprise you? What are you seeing in YOUR market?
Let me know with a comment!