A low unemployment rate and a surge in new jobs has meant good news for multifamily owners and investors in the suburbs of Grand Rapids, Michigan. According to the latest research from Colliers International, the region’s strong economy has led to higher monthly rents and lower vacancies.
According to third quarter research from Colliers, monthly rent has increased for five consecutive years in the suburban Grand Rapids market. In the third quarter of this year, rents in this region increased 4.5 percent on a year-over-year basis.
Compare that with the rest of the nation, where rents were up just 2.9 percent this September compared to the same month a year earlier.
Colliers researchers don’t expect apartment rents to fall anytime soon in the Grand Rapids suburbs. That’s partly because there is a limited number of new multifamily projects in the pipeline here. But demand is playing a role, too. A growing number of people are interested not only in moving to the Grand Rapids area but foregoing the upkeep of maintaining a house once they do so.
Add the fact that the unemployment rate in the Grand Rapids area remains low and you the perfect formula for a strong multifamily market.
According to Colliers’ research, the average effective apartment rent in the Grand Rapids suburbs stood at $967.20 in the third quarter of this year. The average occupancy rate was strong, too, hitting 96.66 percent in the quarter.
What does 2020 hold for the suburbs here? Colliers predicts that occupancy levels should remain strong. Colliers said, too, that owners should expect small apartment rent increases in 2020. Colliers also says that investor demand for West Michigan multifamily will continue to outpace supply. There will be more buyers than sellers, which will boost competition and keep values high.
