The US Census Bureau’s Housing Vacancies and Homeownership data give us access to information about homeownership and vacancy rates in the country.
In April, the federal agency released its latest report for 2022’s first quarter. Let’s discuss its findings and how they will affect real estate investors this time.
US Homeownership & Vacancy Rates for Q1 2022
The US Census Bureau recently came out with a press release containing relevant information about the status of homeownership and vacancy rates in the country. According to its latest press release, the national vacancy rates for the first quarter of 2022 were 0.8% for homeowner housing and 5.8% for rental housing. Compared to Q1 2021’s rental housing vacancy rate of 6.8%, 2022’s Q1 dropped by 1% while remaining statistically the same for Q4 2021’s 5.6%.
On the other hand, the homeowner vacancy rate dropped by 0.1% from Q1 2021’s 0.9% and is statistically similar to the 0.9% registered for Q4 2021.
As for the US homeownership rate for the first quarter of 2022, we see a very slight difference at 65.4% from 65.6% in Q1 2021 and 65.5% in Q4 2021.
According to the same press release, the vacant for-rent units’ median asking rent for Q1 2022 was $1,255, while the median asking price for vacant for-sale units was $225,500.
For those unaware, the federal agency’s quarterly report is frequently used by analysts and the media to keep track of the general trends and behavior for nationwide household formation, homeowner and rental vacancy rates, and homeownership rates. However, the reports’ accuracy is still debatable, depending on who you talk to.
According to some experts, the report should be used as a guide to trends and should not be, in any way, regarded as the absolute representation of the market condition. For more details on the US Census Bureau’s Q1 2022 report, you can access the document here.
What Does the Report Mean to Real Estate Investors?
The latest press release can be put to good use by real estate investors to determine the present market conditions. There is a wealth of information found in such reports as they contain relevant info and data for the US, regions, states, and 75 of the biggest Metropolitan Statistical Areas (MSAs).
The said data is available as quarterly and annual reports, which can be used by investors as part of their research and analysis when considering investment properties.
For real estate investors, whether you’re into rental properties, wholesaling, fix-and-flips, or buy-and-hold investing, interpreting the data found on the report will actually do you some good. Given how well the real estate market performed in 2021, it is safe to assume that the market will continue to grow stronger over the next few months. It comes despite the pandemic and the statistical similarities between homeownership and vacancy rates in the country in the first three months of 2022.
The report also somehow validates some predictions and forecasts for the 2022 US housing market. While the recent somewhat unexpected spike in interest rates sped up year-end predictions to Q1 2022, the growth in real estate is inevitable, despite the ongoing pandemic.
How Real Estate Investors Can Benefit
What does it ultimately mean for investors? It just means that they can still take advantage of low-interest rates and high demand for real estate at present. There are still lots of individuals looking for better housing options to accommodate certain pandemic-induced lifestyle changes. A growing number of people who bought houses in the suburbs at the height of the pandemic are now making their way back into urban centers.
On the other hand, a lot of folks who live in bigger cities are still making their way out into the suburbs for more livable space, especially since it seems like remote work is not going anywhere any time soon. Individuals and families are also taking to the road for longer vacations and road trips, given the ease of travel restrictions. And then, some folks prefer a more nomadic approach to life and are in constant need of short-term rentals to rent for longer periods.
While most types of real estate investors can benefit from the above information, the ones that can make the most of it are those who are heavily into rental property investments.
Median Property Prices
As rental property investors, they can help address the growing demand for adequate housing by providing folks with more affordable means to own a roof over their heads, especially since median prices continue to go up by the day. If we take a look at the difference in median prices from January 2022 to May 2022, one will see that the general trend is continuous growth. Consider the following locations and the differences in median prices:
- January 2022: $1,013,642
- May 2022: $854,063
Baton Rouge, LA
- January 2022: $488,877
- May 2022: $547,925
- January 2022: $1,326,424
- May 2022: $1,063,363
- January 2022: $795,968
- May 2022: $970,317
Salt Lake City, UT
- January 2022: $593,921
- May 2022: $715,182
The above numbers were taken from real estate website Mashvisor’s database. To set aside doubts about the numbers above, Mashvisor regularly updates its real estate market database because the website is used by investors not just to search for properties but to perform data analysis. By keeping its database regularly updated, Mashvisor is ensuring greater accuracy for real estate market analysis.
To learn more about how we will help you make faster and smarter real estate investment decisions, click here.
Now that it’s out of the way, given the data we gathered from Mashvisor, one would see that three out of the five cities have seen a significant increase in median property prices within three months. And while Anaheim and Boston saw significant drops in property values, a downward trend is more of an exception than a rule.
Generally speaking, real estate properties appreciate over time, as seen in the other three locations (Baton Rouge, Miami, and Salt Lake City). Given how the market has been picking up as of late, median property prices will continue to go up, as well as interest rates on mortgages (even if they are still considerably low historically).
So, for investors who are still on the fence about buying real estate this year, you may want to seriously consider getting a piece of the action now while the market is still hot and prices (both property prices and mortgage rates) are still affordable.
Mashvisor’s Tips on Keeping Occupancy Rates High
Whether it’s to attract guests or keep existing tenants, landlords and hosts can always make certain improvements to boost their occupancy rates.
Always Choose Locations That Are Attractive to Tenants and Guests
If there’s one thing that’s crucial to real estate investing, it is location.
You may own the nicest home there is, but if it is located in an area where population density is low and tourism is not thriving, then it will be a struggle to get your rental business off the ground.
When considering a rental property’s location, whether it’s a traditional rental or an Airbnb business, you need to consider the following factors:
- Economic growth
- Job opportunities
- Commercial centers
- Educational system
- Public amenities
- Low crime rates
These are just some of the things you need to factor into your decisions. If you’re starting Airbnb business, you also need to find out about the local short-term rental legislation and relevant tax laws. Doing so will ensure that you don’t run into any legal issues down the road.
Screen Your Tenants and Guests
A smart landlord and Airbnb host will always screen their tenants and guests. It is to prevent any future headaches brought about by bad tenancy. Tenant retention and higher Airbnb occupancy rates start with a good tenant and guest screening. Here are a few things landlords and hosts should be aware of:
- Tenant credit report (for long-term rentals)
- Eviction history (if any)
- Criminal background check
- Talk to employers, employees, or colleagues of the tenant (for long-term rentals)
- Talk to past and current landlords for long-term tenants or previous rental property hosts for short-term renters
Be a More Thoughtful Landlord and Host
Another great way to boost your rental property’s occupancy rate is to be a more involved and thoughtful landlord or host. It doesn’t mean that you need to be ultra-friendly and become BFFs with your tenants and guests.
Tenants and guests are more likely to stay (for long-term renters) or return (for short-term guests) if the property owner is approachable, accommodating, and pleasant to be around. While it is still a business, building and maintaining good relationships with tenants and guests do more good than bad for any rental property business.
It can be done by:
- Responding to tenants and guests (including inquiries) promptly and politely
- Communicating constantly with them about any changes involving the property, such as home improvements, price adjustments, or even neighborhood changes
- Respecting the privacy of tenants and guests
Keep the Property Well-Maintained
A well-maintained property makes for an attractive one. Rental property owners who invest in their property’s upkeep show that they want the best and safest living conditions available to their tenants and guests. It increases confidence, which is also likely to reflect a boost in occupancy rates.
Here are the ways a property owner can provide guests with a well-maintained unit:
- Performing regular inspections
- Carrying out repairs immediately
- Updating the property as needed
- Giving the property a fresh paint and carpet cleaning annually
- Proper landscaping
We’re sure there are several other ways that property owners can show care for their tenants and guests by keeping the property well-maintained, but the above is enough to do the trick.
Related: What Makes a Good Rental Property?
Keep Yourself Updated With the Latest Market Trends
Keep an ear to the ground and be aware of what the market is like around you. Some rental properties aren’t getting as much attention in neighborhoods where similar rental comps are doing exceptionally well because the owners are out of touch with reality.
Landlords and hosts need to constantly keep themselves updated with the changes and trends in their neighborhood so they can make the appropriate adjustments to their management and rates.
Get Feedback From Leaving Tenants and Guests
Perhaps one of the most effective yet underrated ways to boost occupancy rate is asking for guest or tenant feedback. Doing exit interviews with tenants who are leaving and getting feedback from departing guests can help landlords and hosts improve their services.
Getting negative feedback can trigger most folks to be defensive about their properties or management styles. However, it should be used as motivation to improve and not put-downs. If we just keep our minds open to criticism and take it constructively, we can unlock some of the secrets that will help increase occupancy rates and improve the business.
To learn more about how Mashvisor can help you find profitable investment properties, schedule a demo today.
Wrapping It Up
The bottom line is, given the latest homeownership and vacancy rates press release from the US Census Bureau, real estate investors can take advantage of the information provided to make wiser business and investment decisions.
Of course, you will still need the right real estate investment tool like Mashvisor to help get the job done. By utilizing relevant information along with the right tool, real estate investing success is within your reach.
To get access to our real estate investment tools, click here to sign up for a 7-day free trial of Mashvisor today, followed by 15% off for life.