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Houston's Apartment Market Is Weak, But Showing Quarterly Progress

Going back to early 2010, Houston's apartment occupancy rate was the worst across the 64 major metros that form the core of MPF Research's national coverage. The metro's general positioning relative to other markets hasn't changed meaningfully over the past few months, but the Bayou City's metrics certainly are beginning to look better. Roughly 9,900 apartments were absorbed in metro Houston during the April-June period, as quarterly demand topped concurrent completions for the first time in a year and a half. In turn, overall occupancy climbed an impressive 1.4 percentage points for the quarter. And operators even managed to squeeze out a 0.3 percent bump in effective rents over that time span. Still, that progress only brought occupancy to 88.7 percent, about 5 percentage points under the national average. And the quarterly rent increase still left effective pricing 3.7 percent under the rates seen a year ago. With Houston already producing substantial apartment demand, what the metro needs to really get back on track is for new supply volumes to slow in the pattern seen for most other locales across the country. That's where the notable good news comes into play. After 2nd quarter's deliveries — 2,645 units — took annual new supply to some 14,200 apartments, there aren't very many properties that remain under construction. What's left on the way is limited to just under 3,100 units in total, with about half of that stock scheduled to wrap up during 3rd quarter. By the end of 2010 to the first......
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Preliminary Q2 U.S. Apartment Market Data

Robust Demand Boosts Apartment Occupancy and Rents MPF Research starts rolling mid-year apartment market performance results this week, and we begin with a look at what preliminary figures show for the nation as a whole. The news is good any way you slice and dice the data. Initial calcs point to absorption of another 116,000 units during 2nd quarter, taking demand for the first six months of the year to nearly a quarter million units. We're now on pace for calendar 2010 demand to come in at the second strongest annual volume seen over the past couple of decades, exceeded only when Hurricane Katrina evacuees boosted the absorption tally in 2005. Obviously, the addition of some jobs is a big part of the demand story, but there's more to it than that. For example, renters are continuing to return to traditional apartments from individually-owned condos and single-family homes offered for lease. Also, some young adults who had combined into roommate living arrangement are splitting up into separate households. And an improving economy means that more parents are willing to guarantee leases in order to kick their perhaps under-employed kids out of the basement. A new element that seems to be emerging now is that some apartment demand is coming from folks who recently sold their homes. A lot of them were worried that they'd never be able to unload those units, so making another purchase right away is a pretty scary move. A really important thing to realize about the overall......
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Orange County Apartment Demand Surges

Demand for apartments in Orange County came in at about 2,200 units during the initial three months of 2010. Early 2010 actually marked the metro's third consecutive quarter of substantial apartment absorption, taking demand for the year-ending March to a decade high of nearly 6,800 units. With demand well surpassing completions during recent months, occupancy in Orange County's apartment base has recovered by nearly 2 full percentage points from the bottom reading seen in the middle of 2009. However, at 94.4 percent, March 2010 occupancy still was roughly 2 points under the metro's long-term historical norm. The bump in occupancy seen during early 2010 was enough to get rents basically stabilized. In MPF Research's same-store sample, effective rents as of March exactly matched the rates seen three months earlier. Effective pricing still was down on an annual basis, off by 3.8 percent, but that loss sure looked a lot better than the annual decline that earlier had gotten as deep as about 8 percent. While Orange County's apartment performance prospects now appear pretty encouraging in the big picture, the leasing environment for top-tier product certainly should be competitive over the next few months. Influencing that outlook, properties totaling some 2,500 units have scheduled completion dates during 2010's 2nd and 3rd quarters. A portion of the data used in this post is acquired through property management software, which provides property owners and managers the ability to report baseline statistics to county recorder's offices, news publications, and other reporting agencies. Improvements to property......
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Which Home Appliances Use the Most Energy

Homeowners and business establishments are implementing energy saving initiatives on their own accord. These moves are wise on their part as energy saving activities are a must to conserve valuable resources and should have continuous implementation until the time technology is available that can produce renewable, environmental-friendly and really cheap electricity. Although many have already started energy saving measures such as turning off the computer when not in use or using compact fluorescent lights instead of light bulbs to illuminate their rooms, many are not aware of how much their appliances are actually consuming electricity. While many are probably aware of what the Energy Star label means in their relatively newly purchased appliances, majority of homeowners may not be knowledgeable as to what appliance guzzles the most energy. Knowing this information can help in planning your energy savings program so you can focus your actions in how to control or efficiently use appliances with the biggest energy consumption – resulting in more manageable electrical bills as well as reduced environmental impact. How Much Electricity does Standard Home Appliances Use? The 2007 Buildings Energy Data Book have listed space heating as the highest energy user in a home at 31% followed by space cooling at 12%. The remaining electrical energy usage is consumed by standard home appliances for various household applications. Although each individual appliance may not consume as much as heating or cooling, summing up all the electricity usage by these appliances can be significantly big. These appliances are ranked ......
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10 Simple Ways to Save Energy

The recent Global Financial Crisis has made people in various states and probably across the globe to rethink the way they use electricity and other energy resources. Even if energy deregulation in certain states such as Texas have given consumers the power to select Retail Electric Providers that will supply their electricity, it doesn’t mean that they are given free reign of their use of electricity. Prudence and practicality is now the adapted norm that many homeowners and business establishments practice with respect to their use of electricity. Unless a very viable and inexhaustible source of very cheap electricity is discovered, all other homeowners and business owners should have the same mindset and practice all means to conserve energy. The following are 10 of the simplest and easily implementable means of saving energy no matter what state, city or location you are in. Whether you are from Dallas or Houston, it would be wise for you and your household or business to practice these ways to save on your electricity. * Try a little bit of air drying power – Dishwashers consume considerable amount of water as well as electricity, that when accumulated would amount to something significant that would hurt both your pockets and the environment. Go back to basics and use a bit of cloth and air drying power to dry your dishes. * Some like it hot, but better to wash them cold – turn off your washing machine heaters for a while and use cold water instead.......
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Recent Completions in Lease-Up Are the Weak Link in Portland

Portland's overall occupancy rate for apartments was at 94.8 percent as of March, looking good by national standards. Furthermore, the metro displayed strong momentum in recent months, with occupancy improving by nearly 2 percentage points just during the initial quarter of 2010. Most of Portland's individual properties, in fact, now are performing even better than those overall stats would suggest. Roughly two-thirds of Portland's individual properties that MPF Research surveyed in 1st quarter posted occupancy of at least 95 percent, and about two of every five individual projects were no more than 3 percent vacant. The metro's average occupancy in early 2010 was being held down a little by the rates seen in a pretty sizable block of recent completions still moving through the initial lease-up process. Portland added properties totaling about 2,200 units during calendar 2009 and the first three months of 2010. While most of these individual communities are leasing reasonably well, taken as a group, they registered occupancy of just 69 percent as of March. It will be interesting to see what ultimately happens to this recent block of completions in Portland. Almost all of the additions are found in the urban core, and several of them were intended to be for-sale condominiums when construction was initiated. That means rents are very high at some of the projects. The average for communities finished since the start of 2009 is more than $1,600 monthly, quite aggressive for a metro where the norm for the previous generation of product is......
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Houston Lags Behind the Other Texas Apartment Markets in Early 2010

Houston apartment demand came in at about 1,400 apartments during 2010's initial quarter. That's not a bad result for a metro that suffered more than 8,000 net move-outs during calendar 2009, but Houston certainly didn't display the demand momentum seen elsewhere in Texas during the first few months of the year. Quarterly absorption proved more than four times stronger in comparably-sized Dallas/Fort Worth. And the much smaller Austin and San Antonio markets registered quarterly demand about a third better than Houston's performance. Part of the explanation for Houston's lesser demand momentum probably lies in the state of the local economy. While figures currently available from the Bureau of Labor Statistics (BLS) show very similar shifts in the job change patterns across the major markets in Texas (with all of them beginning to register job formation on a month-to-month basis), it's likely that the BLS is either overstating Houston's upturn or understating the rise in Dallas/Fort Worth, Austin and San Antonio. Particularly suggesting that pattern, Houston is not yet showing any demand for middle-tier apartment product, whereas the other Texas markets are. (All of these metros displayed considerable demand for top-tier properties even when they were losing jobs. None of them yet show much progress at the very bottom end of the market.) Also likely influencing Houston's early 2010 apartment demand figures, operators proved surprisingly reluctant to cut rents further. While same-store effective rents fell by a notable 4.5 percent during the year-ending March in Houston, only 0.2 percent of that backtracking......
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What is an Electricity Facts Label?

Ever since the deregulation of electricity in various states such as Texas, people are given the power to select their Retail Electric Providers. This also paved the way for more competition in an otherwise monopolized industry, giving consumers the option to choose companies that can provide comparatively cheap electricity or be environmentally helpful by choosing companies that make use of alternative forms of energy resources. However, with the myriad REPs that provide electricity to the millions of consumers in the state, it would be difficult to choose among these companies without a standard or a common basis that everyone would comply with. In this regard, the Public Utility Commission of Texas or the PUC have implemented the Electricity Facts Label (EFL) that each of these electric companies should provide consumers. The EFLs provide consumers with an apples-to-apples comparison between companies helping them choose which REPs they will work with. Once they’ve chosen a company, the EFL would then serve as a contract between the REPs and the consumers, with the REPs disclosing everything the consumers need to know about their electrical service. Getting to Know the Electricity Facts Label Similar to the nutrition label required by the FDA for all food manufacturers and products, the Electricity Facts label is also required by the PUC from Retail Electric Providers to give consumers a standardized information sheet where they can learn, and compare, critical information about the REPs products and services. The EFL also serve as a compliance form that indicates the details......
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6 Simple Ways to Cut Your Electric Bill

Energy deregulation have made it possible for the people of several states such as Texas to choose an electric company that will provide the electricity to power their homes or businesses. This power to select provided a competitive element to an otherwise monopolized industry. However consumers should continue to implement ways how they can conserve electricity. Studies have shown that a typical household would spend 44% of their power bills on heating and cooling, another 33% on lighting and other general appliances, 14% on heating water and the last 9% for the refrigerator. Knowing this info would give homeowners an insight as to what areas they should focus on to conserve energy. The following are the top ways for homeowners to conserve electricity. * Insulate Your Home A large portion of the electric bill is spent on temperature regulation. This is due largely to heat exchange or loss in the home’s interiors due to poor insulation. With good insulation, the heating and cooling systems can work efficiently and would consume less energy in order to regulate the temperature. The home should be checked for leaks that will allow heat or cold air to pass through. Check areas where insulation is weak allowing heat exchanges to occur, resulting in temperature imbalances inside the home that heaters or air conditioning would need to compensate. * Set Your Thermostat to Comfortable Levels Still on temperature regulation, limiting thermostat settings to maximum or minimum limits without compromising on comfort can give considerable savings on your......
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Cold Calling, Walking the Vegas Strip and The Bellagio

fearLast June my wife and I had the privilege of attending NAA in Las Vegas.  We stayed at the Luxor and decided on one of our evenings to take a walk to the famous Bellagio.  We had heard so much about it.  It is known for its beauty inside and out.  There was so much positive feedback about this place coming from friends and coworkers, that we purposely put it in our plans to make the trip.  The destination was wonderful but the path to get there was not.  The entire time we walked we were bombarded with people flicking their little cards trying to set us up with escorts.  I was completely mortified and I am sure the expression on my face was the same.  I was completely uncomfortable until I reached the destination I intended to see in the first place.  The Bellagio had invited me on many levels and I responded.   Some recent discussions have inspired the following analogy.  I have been too many trade shows over my career, but NAA was my first national event for the multifamily industry.  I did not know anyone!  The looks on many folks faces was priceless.  It was the look of, who are you, what are you trying to sell me, give me your 1 minute speech so I can get my free pen and tote bag.  I really felt for them.  After my trip down the Vegas strip I wondered if these individuals felt the same way I did. ......
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