The economy in St. Louis, Missouri, has posted some improvements in fundamentals recently, including the addition of 9,000 local jobs in 2011.
A further 12,000 are projected to be added to the city's employment this year, according to data and analysis firm Hendricks & Partners. The number of new jobs was a break from the previous three-year trend of few or no gains, and was sufficient to contribute to higher absorption of multifamily units as construction completions hit a five-year high with 556 units finished.
Most of these were in the surrounding suburbs, according to the firm. The metro area experienced a 1 percent decline in multifamily vacancies, although projections indicate that rate will slow greatly as renewed single-family demand is beginning to mark the area. The employment gains, coupled with a low median home price of $119,000 are contributing to a single-family rebound that may negatively impact the apartment sector to an extent.
Multifamily vacancy rates are expected to remain fairly stable at 6.5 percent during this year and 2013, according to the firm. Rental property management companies may find it more important to attract tenants and screen them given the potential for a decline in demand. Average rents did increase last year to the strongest levels since 2008, suggesting the situation remains positive.