Marcus & Millichap

Central Valley, CA Multifamily Market Report

Third Quarter 2018

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Vacancy Adjusts Minimally Amid Cycle-High Crop of New Apartments

Healthy job creation cultivates demand across asset classes. Hiring velocity in the Central Valley continues to outpace the national rate of increase, fueling population gains in a region known for its lower cost of living. Diverse job creation during the next six months, led by healthcare-related expansions, supports the formation of 35,000 positions in 2018, a total that eclipses the previous five-year average. Strong employment growth across at least four various-paying sectors coincides with a period of historically low vacancy in nearly every county that comprises the Central Valley, enhancing renter demand for apartments of differing quality. The recent lack of new supply in most of the region’s counties, including Kern and Fresno, further heightens the need for Class A and B units as the year progresses, likely prompting an increase in project proposals within the Valley’s larger markets and expanding midsize cities.

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