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- 🏗️ San Jose's Incentives Boost Multifamily Development
🏗️ San Jose's Incentives Boost Multifamily Development
📈 Data Point
Renters Drive Household Growth in Q1
In Q1 2025, renter households surged by 687,000, marking a 0.6 percentage point increase in the national rentership rate to 34.9%. This growth occurred despite a rise in the overall rental vacancy rate to 7.1%, with multifamily units (5+ units) maintaining an 8.2% vacancy rate. The trend underscores a shift towards renting, driven by affordability challenges and changing housing preferences.
🧭 Market Watch
San Jose's Incentives Boost Multifamily Development
San Jose is revitalizing its housing market by extending incentives for multifamily developers. The city offers substantial reductions in construction taxes and inclusionary housing fees for the first 1,500 units built in designated growth areas. Projects that applied by June 2022 and secure permits by year-end are eligible, with additional tax reductions planned for 2026. These measures aim to stimulate construction activity, addressing the city's housing shortage.
🧾 Rule of the Day
Loan-to-Cost (LTC) Ratio
The Loan-to-Cost (LTC) ratio is a metric used in real estate financing to assess the proportion of a project's cost that is financed through debt. Calculated by dividing the loan amount by the total project cost, a lower LTC indicates higher equity investment by the borrower, reducing lender risk. Lenders often use LTC to determine loan eligibility and terms, ensuring the borrower's commitment to the project's success. Know more.
🌱 Green Build
Integrating Climate Risk Assessments in Multifamily Investments
With the increasing frequency of extreme weather events, integrating climate risk assessments into multifamily real estate investments has become crucial. These assessments evaluate factors like heatwaves, heavy rainfall, and droughts, informing decisions on property design, location, and insurance. By proactively addressing climate risks, investors can enhance property resilience, protect asset value, and ensure long-term sustainability. Know more.
🏘 Deal Radar
Columbus, OH This multifamily property offers a prime investment opportunity in Columbus's Grandview Heights area. The units feature modern amenities and are situated near major employment centers, making them attractive to tenants seeking convenience and comfort. | Southaven, MS Foxhaven Apartments is a well-maintained community located in Southaven, offering spacious units with modern finishes. The property boasts amenities such as a swimming pool and fitness center, catering to residents' lifestyle needs. | Lodi, CA Situated in Lodi, this multifamily building presents an excellent investment with its strategic location and strong tenant demand. The property features updated units and is close to local amenities, enhancing its appeal to potential renters. |
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