Austin Apartment Deals: A Renter’s Cheatsheet

Kwelia provides price-transparency for the apartment-rental industry. By analyzing millions of data-points, Kwelia can uncover the best deals available for renters, intelligently price apartments for property owners, and predict upcoming real-estate trends for investors.

 

In our last posting, we reviewed Austin’s top apartment deals. Unfortunately (for renters) many of last week’s deals are no longer available, giving testament to Austin’s highly desired real estate market; In 2013, Austin showed above a 95% occupancy rate for apartments,  leaving little room for future renters. Fortunately, Kwelia is here to save the day with yet another iteration on this week’s top  apartment deals in the Austin area.

Sabina

If you’re a renter who prefers a quieter, more homely (the “cozy” definition, not the “unattractive” one) neighborhood, check out Sabina properties, located in North Austin’s Hancock area. Sabina offers a 2-bedroom, 2-bath, 1,080 square foot apartment with monthly payments of $1,950; Sabina throws in a free month’s rent, reducing the renters’ overall monthly payments to $1,787/month. As a result, Kwelia ranks the Sabina a cool 85/100.

Why this deal wins

Not only does Sabina offer a quiet, safe neighborhood but the apartment comes furnished with luxury granite countertops, stainless-steel appliances and in-unit washer & dryer. Access to an elevator makes moving-in easy to the newly renovated apartments. Additional value is derived from Sabina’s 1-month free promotion when you sign the lease.

 

Berkshire SoCo

If you’re not a fan of the north, head south and check out Berkshire SoCo. Berkshire is currently offering a 1,221 square foot, 2-bedroom, 2-bath luxury apartment for $1,694/month. Berkshire’s offering has been rated a 65/100 by Kwelia’s algorithms.

Why this deal wins

While Berkshire SoCo is not as highly ranked as Sabina, the property offers a huge advantage – a garage. With a car, a renter will still need to drive 16 minutes into town but will have the flexibility for weekend getaways and explore the beautiful, more rural parts of Texas.

 

Falcon Ridge

If you enjoy Berkshire SoCo’s location, you might want to also check out Falcon Ridge – a 2 minute drive further south. The additional 2-minute drive will yield a 1,120 square foot apartments with 2-bedroom and 2 bathrooms priced at $1,266 (after 1-free month lease signing). The deal offered at Falcon Ridge is almost too good to pass up, scoring a Kwelia rating of 74/100.

Why this deal wins

Not only does Falcon Ridge offer luxury apartments with elevators for easy move-in, but Falcon Ridge offers many outdoor activities including, but not limited to, access to Williamson Creek, a volleyball court, two swimming pools, jogging trains, and public BBQ grills – perfect for some fun in the sun!

Coming up next week…

Grab these apartments while you still can because, like our last posting, most apartments are only on the market for a week! None the less, the team at Kwelia will be your eyes-and-ears keeping you up-to-date on the best apartment deals within the area.


If you’d like to learn more about Kwelia, sign up for our mailing list or login to find other apartment deals throughout the area.

Why the Zillow-Trulia Merger Is Meaningless for Real Estate Innovation

The NY Times (and others) are reporting today that Zillow is going to acquire Trulia for $3.5 billion in stock. This is a massive merger that will no doubt effect massive change in the real estate media landscape. This news is not surprising given Zillow CEO Spencer Rascoff’s goal of “[creating] a portfolio of real estate properties, becoming more along the lines of an IAC/InterActiveCorp.”

The comparison to a media holding company such as IAC is a good one. Zillow’s primary innovation has been to bring real estate marketing online. Now, their path to future growth is to get more eyeballs on their content via acquisition.

And by all accounts, the new Zillow has a healthy market opportunity in front of it:

“The revenue of the merged company — $341.2 million last year – represents only a small part of what he [Rascoff] reckons is the $12 billion the real estate industry spends on marketing each year.”

However, this isn’t going to do much to affect the way actual real estate business is conducted.

Zillow is a real estate marketing company, but the real estate industry is not primarily a marketing business. Zillow may be content to own this niche, but there are much bigger opportunities out there to innovate in real estate.

Property management is a $69 billion annual business in the US alone. A big chunk of what property managers do could be conducted online, but currently isn’t.

Real estate development and investment is a order of magnitude larger than that, and is vastly under-served by the incumbent software and data offerings.

And yet, relatively few startups have attempted to serve these markets.

At Kwelia, we’re excited to capitalize on Zillow’s missed opportunity. We’re building the data platform that powers true innovation in real estate, and we’re starting with rental housing data. If you’re ready to join the next wave of real estate innovators building on our platform, drop us a line.

Philly’s Best Neighborhoods for Deals: An Analysis of Amenities and Price

If you’ve been following our coverage of the Philadelphia rental market, you already know which of Philadelphia’s rental neighborhoods are the hottest in May and in the summer. However, there’s more to consider when looking for an apartment than just the price and the location; amenities are important too. To shine some light on this aspect of the rental market, we first asked: which amenities are available, and what fraction of apartments feature them? After selecting a number of luxury amenities to investigate, we looked to the data as usual for some insights into the distribution of rental amenities throughout Philadelphia.

Is “luxury” actually rare?

Overall, the single most frequently listed amenity throughout the rentals was “stainless”, as that amenity was present in nearly 11% of the listing observations (“stainless” likely refers to stainless steel kitchens).  Listings for rentals with doormen were the least common, comprising roughly 1% of the listing observations. Nevertheless, between one-fifth to one-quarter of all rental listings had at least one luxury amenity.

Next, we looked at how the term “luxury” is used compared with more specific feature descriptors–while the presence of granite, stainless, or a doorman are all objective and verifiable, the scope of what is considered “luxurious” could prove a bit more subjective. Did the use of the term “luxury” line up with how often we would expect to see it, given what we’ve observed about the frequency of luxury features? It would appear that, yes, there is some truth in advertising–only about 4% of apartment listings indicated that the unit had “luxury” features, suggesting the term is used judiciously.

Is there a better time to look for a luxury apartment? From the chart above, we can see that the proportion of listings with any luxury amenities stayed between one-fifth and one-quarter for the past ten months. Although the winter months saw a slight decline in the frequency of luxury apartments, the impact of seasonality appears to be relatively low, at least in this year.

Let’s talk cost/benefit

Ritzier amenities tend to come with ritzier price tags, however. Lest we forget, apartment rentals, like anything in life, demand tradeoffs. With that in mind, which neighborhoods have listings with the most “bang for the buck?” Given the information on neighborhood amenities newly in hand, as well as our previous coverage of Philadelphia rental neighborhood prices, we only had to combine the two to produce a ranking of the “best deal” neighborhoods in Philadelphia:

Best Deal: Mill Creek

A quick note on methodology: the “best deal” ranking above is derived by taking the price per square foot in the neighborhood and dividing by the median frequency of having any luxury amenity (lower ratios are better). This metric provides insight into the most affordable places to find apartments that also have luxury features. Lastly, to keep the rankings relevant to current market conditions, the prices and amenity frequencies used are the three-month moving average of their respective monthly median values.

The top-five “best deal” neighborhoods overlaid on our rental price heat map

The map and the rankings show that there are a number of neighborhoods with affordable but well-equipped rentals, especially West and North of Center City. In fact, the majority of apartments listed in Mill Creek and Haverford North (numbers one and two, respectively, on our list) have at least one luxury amenity. While Mill Creek has consistently posted high figures for the proportion of its rental stock with a featured amenity over the past ten months, the fraction of such listings in Haverford North has increased dramatically since the fall of 2012, especially since this April:

There’s no such thing as a free lunch

The impressive increase in the median frequency of luxury listings in Haverford North over the past five months has not come without a catch. As this screenshot from our Competitive Intelligence product shows, the rise in the proportion of luxury listings has been mirrored by a dramatic increase in median rental rates. From April to June (and persisting into August), the median rent per square foot in Haverford North roughly tripled.

Wrap-up

There’s definitely more than one angle to look at all of this data, and plenty more data to analyze, so check back for more on rental markets around the country.

Philadelphia’s Hottest Rental Neighborhoods: The Summer Update

Back in June, we wrote about the beginning of the summer “leasing season” with our report on “Philly’s Hottest Rental Neighborhoods in May”. With Labor Day rapidly approaching, let’s take a look at the rental market action so far.

While prices cooled off a bit from June to early July, the prognosis for the rental market in 2013 continues to be positive, with growth in apartment rental demand outstripping available stock, as noted in this Philly.com article. Furthermore, vacancy rates appear to be retreating after a jump earlier this summer. To meet the growth in rental demand, 2013 expects to see the addition of more rental units than last year, such as the newly opened 2116 Chestnut property that we will touch on again below. Overall, the rental market heated up through July–but which areas saw the greatest demand? Without further ado, here are the hottest Philadelphia rental neighborhoods for July:

Who’s at the top?

Rittenhouse tops the list of the most expensive rental neighborhoods in Philadelphia this time around, with a median rental price of $2.44 per square foot. Nine of the top ten priciest neighborhoods from May made it to the July list, with the sole newcomer this time being University City, which nabbed a close second place to Rittenhouse with an impressive rental rate of $2.41 per square foot. Rittenhouse saw prices rise 17.9% as vacancies decreased through the month, in part due to fewer available units in the new 2116 Chestnut building by The John Buck Company that opened earlier this summer. Previous number one Fitler Square remained in the top four, with Callowhill staying put in third place. Perennial contender Old City rounded out the top five, with prices in the top ten up overall month-to-month.

University City and Rittenhouse Rates Grew Significantly from June to July

Movers and Shakers

While rental rates rose overall across the board, the rental market in University City experienced the greatest price growth of any Philadelphia neighborhood from June to July, with median rates increasing an amazing 78.5%. Neighboring Woodland Terrace prices also grew impressively, at a 37.4% rate from June to July. Why the large change in both of these neighborhoods? As discussed previously, the seasonality of the academic year likely plays a significant role in prices in the University City area, with nearby Woodland Terrace absorbing some of the demand. The demand from the influx of students and faculty preparing for a new academic year has driven up rates as the summer leasing cycle concludes.

The impact on Woodland Terrace (unpublished June rank: 61) is particularly striking, as it vaulted 41 spots up the list to number 20. Rents in Woodland Terrace increased 37.4% from June to July on the strength of seasonal demand and dwindling vacancies.

Summer Trends in the “Top 10”

Having highlighted the recent price growth in several rental neighborhoods through July, let’s take a look at how the market has shaped up for the top ten hottest rental neighborhoods in Philly so far this summer.

Prices adjust to decreased listings, but lag supply changes

We can see that prices climbed into May, fueled by increased demand as “leasing season” began. The stock of listings increased markedly in May, likely driven by the addition of new units as well as seasonal leasing cycles bringing more apartments onto the market. This surge in rental listings is reflected in swooning prices through June into July, despite reduced availability of units. However, prices rallied from July, adjusting to the decreased number of units on the market. Nevertheless, there is a perceptible time-lag between changes in listing supply and price adjustment (a good reason to adopt Competitive Intelligence!).

Methodology Note: The constituents of the “ten hottest” rental neighborhoods in Philadelphia change somewhat from month to month. To track how the rental market for the top ten most expensive neighborhoods evolves from month to month, the prices given in the chart above are the weighted average of the median rental rates of the members of the top ten priciest neighborhoods for each month.  This provides an approximation for a “characteristic” price for the ten most expensive neighborhoods in Philadelphia in a given month.

Closing Remarks

Check back for future updates as we continue to follow the hottest rental neighborhoods; we’re constantly keeping an ear to the ground to track neighborhood pricing movements.