Central Valley Apartment Market Finds Equilibrium; Forecast Average Rent Gain Below New State Law
Consistent fundamentals define apartment fundamentals. Steady population and employment growth in the Central Valley are supporting apartment demand, keeping vacancy well below the 5 percent threshold. Payroll expansion in the region has centered on the government and education and health services sectors, which added 17,800 jobs over the past 12 months. The other nine sectors contributed another 4,000 spots, lifting the rate of employment growth above Los Angeles and Orange counties. Apartment demand is relatively balanced throughout the spectrum in the Central Valley. In fact, Class A, B and C vacancy are huddled just under 4 percent for the region. As a result, effective rent growth will remain strong across the board and provide landlords leverage to raise revenue in the coming quarters.