Despite Stagnant Real Estate Prices, Equity Residential Reports Rent Growth
Apartment construction is at its highest levels since the mid-1980s amid the well-publicized housing shortage There has been a divergence of late between single-family home construction and apartment construction. This is primarily due to affordability issues -- starter homes are relatively expensive to build, and mortgage rates are high. This is pushing some would-be home buyers into luxury apartments. You might think that would help apartment real estate investment trust (REIT) Equity Residential (NYSE: EQR), but that hasn't been the case.
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Equity Residential is one of the biggest developers and operators of luxury apartments in large urban coastal markets. It owns properties in Boston, New York, Southern California, San Francisco, Seattle, and Washington, D.C. It's also building a presence in Denver, Atlanta, Dallas, and Austin, Texas. The REIT targets markets with strong economic fundamentals and robust job growth. This ensures that its properties have strong bases of educated and highly paid potential tenants. Equity Residential also favors markets with tight apartment supply and very expensive single-family housing.
Source Fool.com
