Job growth is often a useful predictor of apartment demand. A bump in handsomely compensated employees, in-migration by talented job seekers, and solid ratio of income-to-housing costs all point to a market with a growing population of renters that prefer the amenities-laden comfort found in market-rate apartment units.
We identified three markets where all of these economic factors are in play. Despite the influx of new supply in many of these markets, elevated employment activity suggests that these markets will boast a healthy appetite for new construction in the coming year.
Tech job growth continues to anchor employment in the Seattle metro, which improved annually by 3.3% through September 2019. Employers in the information sector brought on 7,200 new employees (6.0% growth year over year); Seattle remains a promising destination for startup companies, thanks to the presence of tech giants like Microsoft. Seattle also saw a 5.1% spike in manufacturing employment, due to 8,300 new hires in the sector.
Household incomes in the metro during this period improved by 2.6%, up to $85,539 annually. With wages on the rise, the metro has become more affordable. Rent share of wallet was equal to 25.8%, besting the national average by 20 basis points.
Salt Lake City
Salt Lake City has proven to be an increasingly positive destination for job seekers and growing companies alike due to its reputation as a “career-friendly” metro. Specifically, the metro has become increasingly popular among young talent seeking entry-level jobs with competitive salaries in a metro with low cost of living. It was no surprise, then, that local employers brought on 16,200 new hires annually through September 2019, a payroll expansion of 2.2%.
Supported by 8,800 new hires in the professional and business service industry, household incomes increased annually 1.8%, up to $77,535. Salt Lake City renters continue to enjoy a very affordable lifestyle, thanks to an exceptional 18.2% rent share of wallet. Among the biggest hiring pushes taking place during the last year included Amazon’s plans to bring on 1,500 new employees for its new fulfillment center.
An influx of tech companies relocating into the area was a boon for Orlando’s labor pool. Overall, 51,000 new hires were recorded through September 2019, a gain of 3.9%. These additions were primarily in the professional and business services sector, where employers brought on 21,600 new hires.
Residents saw household incomes improve annually through the third quarter, up 6.2% to $61,522 since the third quarter of 2018. Growing incomes also helped to maintain the metro’s attractive rent share of wallet metric, equal to 24.8%.
Orlando’s economy is driven in large part by growth in its massive leisure and hospitality sector, which expanded by 3.6%. Multiple theme parks, like Disney World and Universal, ramped up hiring during this period, including for full-time/non-seasonal positions.
Focused On Employment Growth
Berkadia’s third quarter Multifamily Reports provide a comprehensive snapshot of hiring, unemployment, and wage growth. We aim to provide in-depth analysis about the economic forces driving multifamily development and provide our readers with the story behind the story.
- Check out our Orlando, Seattle, and Salt Lake City Multifamily Reports for greater insights into three of the nation’s top metros for job growth.