Multi-family permits have increased drastically in Scottsdale in the last 2 years, making many people wonder, where will all the tenants come from?
According to Mike Orr of The Cromford Report, multi-family permits issued in Scottsdale between January 2013 and the end of November 2014 totaled 2,518. In comparison, only 1,124 single family permits were issued in the same time.
The ratio of multi-family permits to single family permits, at 2.24 to 1 is the highest it has ever been, and in fact has doubled in the last 2 years. The rise in this ratio is a result of the combination of a 134% increase in multi-family permits in that time period, and a 60% decrease in single family permits.
Many local real estate industry experts have speculated that we are soon going to have an oversupply of rental apartments in the Scottsdale area. If that happens, rental rates will certainly begin to fall, at least for multi-family units.
Other Valley cities that have seen a significant increase in multi-family construction is Phoenix (4,397 permits), Tempe (2,428 permits) and Chandler (1,771 permits) over the same time period.
According to the Cromford Report, the multi-family sector of the market here in the Valley is considered to be fully recovered to the levels of 10 years ago.
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The Matheson Team – RE/MAX Fine Properties
21000 N. Pima Rd., #100, Scottsdale, AZ 85255