The Survey of Market Absorption (SOMA) measures how soon privately financed, nonsubsidized, unfurnished units in buildings with five or more units are rented or sold (absorbed) after completion. In addition, the survey collects data on characteristics such as number of bedrooms, asking rent, and asking price.
The estimates in this report are based on responses from a sample of the population. As with all surveys, estimates may vary from actual values because of sampling variation or other factors. All comparisons made in this report have undergone statistical testing and are significant at the 90-percent confidence level.
An estimated 71,000 apartments were completed in buildings with five units or more in the third quarter of 2009. This estimate did not differ significantly from apartment completions in the previous quarter, nor did they differ from similar completions in the same quarter of the previous year (table 11).
Of the 71,000 units completed in the third quarter of 2009, approximately 43,500 were privately financed, nonsubsidized, unfurnished, rental apartments. This estimate was not significantly different from the estimate of unfurnished units completed in the previous quarter, however it was about 6,200 greater than completions in the same quarter of the previous year (Table 1).
An estimated 52 percent (seasonally adjusted) of the newly completed, unfurnished apartments built in the third quarter were rented (absorbed) within 3 months of completion. This estimate is greater by about four percentage points than the estimate of the previous quarter, but was about 3 percentage points lower than the same quarter of the previous year (Table 1). The not-seasonally-adjusted 3-month absorption rate of 52 percent for the 43,500 apartments completed in the third quarter of 2009 did not differ statistically from that of the previous quarter, nor from the rate in the same quarter of 2008 (Table 1).
The median asking rent for all privately financed, nonsubsidized, unfurnished rental units completed in buildings with five units or more in the third quarter of 2009 was $1,103. This estimate is did not differ statistically from the revised median asking rent of the previous quarter. More new units built in the third quarter of 2009 contained two bedrooms (48 percent) followed by units that contained one bedroom (41 percent). Units with three bedrooms or more accounted for about 9 percent, while efficiencies (no bedroom) accounted for only 2 percent of the total (Tables 2 and 3).
During the third quarter of 2009, the South had the majority (59 percent) of new unfurnished rental completions among the four regions of the US. The West with 26 percent, ranked second in terms of rental completions, followed by the Midwest (11 percent). The Northeast, with 4 percent of new unfurnished rental completions, had the fewest (Table 4).
An estimated 9,600 condominium and cooperative apartments in buildings with five units or more were completed in the third quarter of 2009. This estimate does not differ from that of the revised estimate from the prior quarter, but was about 10,000 fewer than the same quarter of 2008 (Table 5). In the third quarter of 2009, condominiums and cooperatives accounted for about 13 percent of all completions in buildings with five units or more.
About 45 percent of the 9,500 condominium apartments completed in the third quarter of 2009 were sold within 3 months of completion (Table 6). This rate is greater by about nine percentage points than the revised rate from the previous quarter. The median asking price for new condominiums built in the third quarter of 2009 exceeded the upper limit of the price range, and cannot be compared to the median asking price last quarter (Tables 6 and 7).
Of the remaining apartments completed in all buildings with five units or more in the third quarter of 2009, 2,800 were furnished units, 10,200 units were federally subsidized or received a tax credit, and about 5,000 were not in the scope of the survey (Table 11).
CHARACTERISTICS OF THE DATA
All statistics from the SOMA refer to apartments in newly constructed buildings with five units or more. Absorption rates reflect the first time an apartment is rented after completion or the first time a condominium or cooperative apartment is sold after completion. If apartments initially intended to be sold as condominium or cooperative units are, instead, offered by the builder or building owner for rent, they are counted as rental apartments. Units categorized as federally subsidized or receiving tax credits include the units subsidized under the following Department of Housing and Urban Development (HUD) or Federal Housing Administration (FHA) programs --Sections 8, 202, 811, 221(d)(3) or 221 (d)(4). In addition, units receiving Low Income Housing Tax Credit (LIHTC) through the Internal Revenue Service program are included in this category. The data on privately financed units include privately owned housing subsidized by state and local governments. Time-share units, continuing-care retirement units, and turnkey units (privately built for and sold to local public housing authorities after completion) are outside the scope of the survey.
Tables 1 through 4 and Table 9 provide information about privately financed, nonsubsidized, unfurnished, rental apartments. Table 5 provides information about privately financed, nonsubsidized condominium and cooperative apartments, while Tables 6 through 8 and Table 10 provide information about condominium apartments only. Table 11 summarizes the totals for all types of newly constructed apartments in buildings with five units or more.
1. Details may not sum to totals because of rounding.
Contact George Boyd at 301-763-3199 or mail to email@example.com
for further information on the Survey of Market Absorption of Apartments Data.
Source: U.S. Census Bureau, Social, Economic, and Housing Statistics Division