Average Triangle rent up although supply outpaced demand, report shows
The boom in apartment construction that’s happening in Durham and across the Triangle has outpaced demand and is expected to continue to do so, according to a report from the market research firm Karnes.
The Charlotte-based firm released a report Thursday that said that the number of new apartment units under construction in March was greater than construction reported in any other period since 1997.
Durham was a contributor to that statistic. South Durham had the third-largest number of units under construction of 11 submarkets in the area, behind southwestern and northeastern Wake County.
There were six different apartment complexes and 1,546 units under construction in South Durham, according to the report. Comparatively, there were five different apartment complexes and 1,227 individual apartments units – including one student-oriented complex -- under construction in northern Durham in that same time period, all either downtown or around Ninth Street.
Those are apartments that are underway, and not yet completed. And that doesn’t count proposed projects whose construction has not yet begun.
According to Karnes, the number of new apartments that came online in six months through March outpaced demand. The firm expects that the development pipeline “should be too great for seasonal demand,” not counting the proposed new projects targeted to begin in the next 12 months.
During the six-month period through March, 2,863 new units came online in the Triangle, and there was net absorption of 795 leased units. Durham County actually saw a contraction in demand, with a net loss of 61 leases. Within the county, South Durham saw increased demand by one unit, and North Durham saw a loss of 62.
And although the new supply outpaced demand, rents across the Triangle as a whole grew in March compared with September and March of last year, according to Karnes. The average weighted monthly rent in March, at $913, was up $15 from September’s average and up $34 from March of 2013’s.
Comparatively, another market research firm, Real Data, had reported in its market summary earlier this year that the average rent was $893 in January, up from $868 in January of 2013 but down from $962 in July of last year.