In Arbor Chatter's latest Multifamily Research, the Arbor team presents research on various multifamily market trends and news. The research covers everything from how apartment community size affects unity and neighborhood ratings to the role of public transportation in suburban apartment areas. In researching small apartment buildings, research found that near 65% of occupants rated their units more favorably than those occupants of large buildings. Occupants in smaller buildings rated the schools in their area more favorably than those in larger buildings but rated their public transportation options as lower than those inhabiting large buildings.
2. Arbor Chatter Multifamily Research
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2. Climate Resiliency Can Further Reduce Flood Risk Impacts on Multifamily Rents
5. How Apartment Community Size Impacts Unit and Neighborhood Ratings
9. Small Buildings Still Dominate Apartment Renter Shares
13. Small Building Renters Are Growing in a Handful of Regional Markets Amidst General Decline
17. Are Baby Boomers the New Millennials in Multifamily?
20. Single-Family Homes Play a Bigger Role in the Rental Market
24. Top Reasons Why Renters Move into Small Apartment Buildings
27. How Do Small Building Renters Find Their Apartments?
31. Suburban Apartment Renters Shifting Slightly Away from Vehicle Ownership
34. Public Transportation Picking Up Among Suburban Apartment Renters
37. Need for Higher Speeds: An Updated Look at Internet Usage in Small Apartment Buildings
Table of Contents
3. Climate Resiliency Can Further
Reduce Flood Risk Impacts on
Multifamily Rents
March 21, 2018
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4. Arbor Chatter Multifamily Research
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With a lower share of inventory located in
flood-prone areas, small buildings are more
conservative in their risk profile and offer
value for investment across the apartment
market.
Around 8% of all small apartment building
units in the United States were located
within areas assessed with a high risk of
flooding. In large buildings the share was
slightly larger at 10%.
The risk assessment for apartment
buildings and their units varies greatly
across metro areas. The data indicates that
small buildings displayed a tighter spread
around the national average compared to
large buildings. An indication of the
preference for scenic, albeit riskier,
locations characterize the latter group.
Apartment Inventory Located in Flood Risk Areas
Units Assessed at Flood Risk per Resident Response as Share of Total Asset Class Inventory
Climate Resiliency Can Further Reduce Flood Risk Impacts on Multifamily Rents
0% 8% 16% 24% 32%
Atlanta
Boston
Chicago
Dallas
Detroit
Houston
Los Angeles
Miami
New York
Philadelphia
Phoenix
Riverside
San Francisco
Seattle
Washington DC
United States
Small Apartment Buildings Large Apartment Buildings
Source: Arbor Chatter, Chandan Economics, American Community Survey, 2015
https://arbor.com/blog/climate-resilience-support-flood-risk-rents/
5. Arbor Chatter Multifamily Research
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Data also shows partial support for the
counter-intuitive location and price
relationship mentioned earlier.
When indexed to the area-wide average
rents within asset class, apartment rents in
flood-prone areas are higher in the coastal
metros, consistently for large buildings, and
with qualification for small buildings.
While large properties take on more risk for
amenities, small properties appear to have
more conservative risk profiles of long-term
returns for investors.
Unit Rents of At-Flood Risk Inventory Relative to Area Average Rents
Monthly Rent Levels of At-Risk Units Indexed to the Average Rents within Asset Class
Climate Resiliency Can Further Reduce Flood Risk Impacts on Multifamily Rents
0.0 0.4 0.8 1.2 1.6
Atlanta
Boston
Chicago
Dallas
Detroit
Houston
Los Angeles
Miami
New York
Philadelphia
Phoenix
Riverside
San Francisco
Seattle
Washington DC
United States
Small Apartment Buildings Large Apartment Buildings
Source: Arbor Chatter, Chandan Economics, American Community Survey, 2015
https://arbor.com/blog/climate-resilience-support-flood-risk-rents/
6. How Apartment Community Size
Impacts Unit and
Neighborhood Ratings
March 19, 2018
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For their relatively lower rent levels, small
apartment properties are surprisingly well-
rated by their occupants, both in terms of
unit quality and the neighborhoods in
which they are located.
Despite lower rents, small buildings are
competitive products in terms of units and
neighborhood quality.
Around 65 % of households in small
buildings rated their units between 7 and
10 (on a scale of 1 to 10, with 10 being the
best)— toe-to-toe with the ratings by large
building renters in 2015.
Rating of Housing Units in Apartment Buildings
Household Response, Scale of 1 to 10, where 1 = Worst and 10 = Best
How Apartment Community Size Impacts Unit and Neighborhood Ratings
5% 2%
11%
29%
37%
5% 1%
8%
22%
42%
0%
10%
20%
30%
40%
50%
1-2 3-4 5-6 7-8 9-10
Small Apartment Buildings Large Apartment Buildings
Source: Arbor Chatter, Chandan Economics, American Community Survey, 2015
https://arbor.com/blog/property-renters-units-neighborhoods/
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Small property households also rated their
neighborhoods favorably. In fact, 62%, or
the majority of responses, were in the 7 to
10 range.
A slightly higher number of respondents in
large buildings rated both their units and
neighborhoods in the highest rating
categories (9 and 10).
Rating of Current Neighborhood
Household Response, Scale of 1 to 10, where 1 = Worst and 10 = Best
How Apartment Community Size Impacts Unit and Neighborhood Ratings
5%
3%
10%
26%
38%
5% 2%
9%
24%
39%
0%
10%
20%
30%
40%
50%
1-2 3-4 5-6 7-8 9-10
Small Apartment Buildings Large Apartment Buildings
Source: Arbor Chatter, Chandan Economics, American Community Survey, 2015
https://arbor.com/blog/property-renters-units-neighborhoods/
9. Arbor Chatter Multifamily Research
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Nearly 90% of small building renters viewed
schools in their neighborhood as being
‘good,’ which was marginally higher
compared to large buildings.
Small building renters had a relatively lower
opinion of public transportation access in
their neighborhood compared to large
property respondents. However, this
information comes as little surprise given
the latter’s concentration in the urban core.
Favorable Rating of Neighborhood Amenities
Household Response, Agree that Amenities are Good in the Neighborhood
How Apartment Community Size Impacts Unit and Neighborhood Ratings
89%
87%
71%
85%
60%
65%
70%
75%
80%
85%
90%
Small Apartment Buildings Large Apartment Buildings
Schools Public Transport
Source: Arbor Chatter, Chandan Economics, American Community Survey, 2015
https://arbor.com/blog/property-renters-units-neighborhoods/
10. Small Buildings Still Dominate
Apartment Renter Shares
February 27, 2018
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Rental units accommodate individuals to
varying degrees due to a range of unit sizes,
diverse household types, and living
arrangements.
Multifamily properties (5+ units) accounted
for 37% of the nearly 105 million U.S.
renter population in 2016. This was slightly
lower compared to the share of occupied
unit inventory at 45%.
Of this, small apartment properties made
up 28% of the renter population. This share
was three times that of large buildings, but
lower compared to the 45% share in single-
family homes.
Distribution of the U.S. Renter Population
Percentage Share by Asset Class
Small Buildings Still Dominate Apartment Renter Shares
45%
18%
28%
9%
Single-Family Units
Duplex-Quadruplex
Buildings (2-4 Units)
Small Apartment
Buildings (5-49 units)
Large Apartment
Buildings (50 units or
More)
Source: Arbor Chatter, Chandan Economics, American Community Survey, 2016
https://arbor.com/blog/small-multifamily-dominates-apartments/
12. Arbor Chatter Multifamily Research
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The number of renters per unit decreases
with building size.
Single-family units, typically larger and
preferred by families with children, house
3.1 persons on average.
This figure can be compared to only 1.8
persons in large building units, which are
more popular with single renters.
Small building units, which blend
apartment living with more unit space and
cater to diverse household segments, come
in at 2.2 persons per unit.
Average Household Size by Asset Class
Number of Persons per Unit
3.1
2.4
2.2
1.8
0.0
1.0
2.0
3.0
4.0
Single-Family 2-4 Units 5-49 Units 50 Units or More
Small Buildings Still Dominate Apartment Renter Shares
Source: Arbor Chatter, Chandan Economics, American Community Survey, 2016
https://arbor.com/blog/small-multifamily-dominates-apartments/
13. Arbor Chatter Multifamily Research
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The growth and shift in renter demand
broadly mirrors the underlying supply-side
trends.
The small property renter base declined at
an annual rate of 1.6% over 2015-16, in
contrast to an increase of 2.3% over the
previous year.
This decline comes in the context of a large
property inventory supply glut across the
largest U.S. metros, which has helped fuel a
renter population growth of 5.6% in this
asset class over 2015-16 — nearly double
the rate from last year.
Population Growth by Asset Class
Year-Over-Year, Annual Growth Rate
0.3%
2.3%
3.1%
0.8%
0.1%
-1.6%
5.6%
0.5%
-2.0%
0.0%
2.0%
4.0%
6.0%
Single-Family 5-49 Units 50 Units or More U.S. Overall
2014-15 2015-16
Small Buildings Still Dominate Apartment Renter Shares
Source: Arbor Chatter, Chandan Economics, American Community Survey, 2016
https://arbor.com/blog/small-multifamily-dominates-apartments/
14. Small Building Renters Are
Growing in a Handful of Regional
Markets Amidst General Decline
February 26, 2018
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While apartment renting remains a
predominantly urban affair across both the
downtown and suburban areas of large U.S.
metros, renting activity is expanding into
smaller cities and new property types.
Nearly 70% of the nation’s small building
renters lived in the 50 largest metro areas,
with 28% just in the five largest.
Urban orientation is even more
pronounced for large apartment buildings.
Nearly 80% of all renters in this asset class
lived in the Top 50 metro areas, and close
to 40% lived in the Top 5.
In stark contrast, nearly 50% of all single-
family home renters lived outside the
largest 50 metro areas.
Distribution of Renters by Asset Class across Metro Segments
Metro Segment Percentage Share of Asset Class, U.S. Total
Small Building Renters Growing in a Handful of Regional Markets Amidst General Decline
14%
28%
39%
20%
23%
27%
19% 18%
14%
0%
10%
20%
30%
40%
50%
Single-Family Units Small Apartment Buildings
(5-49 units)
Large Apartment Buildings
(50 units or More)
Top 5 Metros Next 15 Metros Next 30 Metros
Source: Arbor Chatter, Chandan Economics, American Community Survey, 2016
https://arbor.com/blog/small-building-renters-growing-regional-markets/
16. Arbor Chatter Multifamily Research
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Mirroring inventory growth, renter
population has declined in small asset
properties across all metro market
segments between 2015 and 2016.
In contrast, renter population in large
buildings soared across the board, at an
annual rate of 9.0% in secondary markets,
and 4.5% in smaller regional markets.
Single-family renters also grew over this
period, but at a more modest rate, keeping
pace with overall U.S. population growth.
Renter Growth by Metro Segments
Year-Over-Year, Annual Growth Rate, 2015-2016
Small Building Renters Growing in a Handful of Regional Markets Amidst General Decline
0.7%
-1.4%
3.0%
0.6%
-2.3%
9.0%
0.8%
-1.2%
4.5%
-5.0%
0.0%
5.0%
10.0%
Single-Family Units Small Apartment Buildings
(5-49 units)
Large Apartment Buildings
(50 units or More)
Top 5 Metros Next 15 Metros Next 30 Metros
Source: Arbor Chatter, Chandan Economics, American Community Survey, 2016
https://arbor.com/blog/small-building-renters-growing-regional-markets/
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Standing out from this overall decline, small
building renters grew in 17 of the Top 50
metro areas. These areas mostly included
smaller secondary and regional metros,
except for large cities such as Dallas,
Boston, Philadelphia, Seattle and San
Diego.
While these shifts may be partially
explained by renter preference, the
overhanging supply glut in large buildings
— combined with the emergence of single-
family renting — is exerting downward
pressure on small property renter growth.
Metros with the Fastest and Slowest Growing Small Building Renter Populations
Year-Over-Year, Annual Growth Rate, Top 50 Metros by Size, 2015-2016
-25% -20% -15% -10% -5% 0% 5% 10% 15% 20% 25%
Richmond
Orlando
Virginia Beach
Madison
Louisville
Birmingham
Denver
Tampa
Jacksonville
Chicago
...
Memphis
Portland
Cleveland
Kansas City
San Antonio
Sacramento
Oklahoma
Providence
St.Louis
Hartford
Small Building Renters Growing in a Handful of Regional Markets Amidst General Decline
Source: Arbor Chatter, Chandan Economics, American Community Survey, 2016
https://arbor.com/blog/small-building-renters-growing-regional-markets/
18. Are Baby Boomers the New
Millennials in Multifamily?
February 23, 2018
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Apartment buildings have a significantly
larger share of younger renters. As shown
below, individuals in the 20-39 year old age
group represented a 43% share of all
renters in small apartment buildings by the
end of 2016. This is a larger share
compared to all other adult renter
categories in this asset class.
In contrast, the share of older renters was
15 percentage points higher in large
apartment buildings, which were still
dominated by 20 to 39-year-olds.
Looking at the rental market as a whole,
single-family units included the highest
share of individuals below 20 years old.
This information indicates the presence of
younger families with children.
Distribution of Renters by Age and Average Age within Asset Class
Percentage of All Renters within Asset Class
Are Baby Boomers the New Millennials in Multifamily?
34%
25%
16%
34%
43%
38%
22%
20% 20%
8%
10%
17%
1% 2%
10%
0
10
20
30
40
50
0%
10%
20%
30%
40%
50%
Single-Family Small Apartment
Buildings
Large Apartment
Buildings
Less than 20 years 20-39 years 40-59 years
60-79 years 80 years and Over Average Age (Years)
Source: Arbor Chatter, Chandan Economics, American Community Survey, 2016
https://arbor.com/blog/baby-boomers-millennials-multifmaily/
20. Arbor Chatter Multifamily Research
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Baby Boomer renters grew at a more
robust annual rate of 5.4% in small
apartment buildings and 4.9% in single-
family homes. As noted in a recent blog,
these asset classes served nearly 70% of all
U.S. renters in 2016.
Baby Boomer growth in large, amenity-rich
apartment buildings comes in a shade
below the Millennials, but with an
impressive overall tally of 4.5% growth over
2014-16.
Renter Growth by Age Segments within Asset Class
Average Annual Growth Rate, 2014-2016
Are Baby Boomers the New Millennials in Multifamily?
-0.4%
-1.1%
2.9%
-0.2%
0.4%
6.0%
-0.2% -0.3%
3.2%
4.9%
5.4%
3.8%
3.5%
1.4%
3.4%
-2.0%
0.0%
2.0%
4.0%
6.0%
8.0%
Single-Family Small Apartment
Buildings
Large Apartment
Buildings
Less than 20 years 20-39 years 40-59 years
60-79 years 80 years and Over
Source: Arbor Chatter, Chandan Economics, American Community Survey, 2016
https://arbor.com/blog/baby-boomers-millennials-multifmaily/
21. Single-Family Homes Play a Bigger
Role in the Rental Market
February 22, 2018
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There were nearly 42 million rental units in
the United States at the end of 2016. These
rental units accounted for about 35% of the
overall U.S. housing inventory.
Of these, multifamily buildings (5+ units)
taken together constituted 45% of all rental
units. This was followed by single-family
homes at 36%, and duplex-quadruplex
units at 19%.
Units in small apartment buildings (5-49
units) comprised 32% of the overall U.S.
rental inventory. Large buildings (50 units or
more) formed a share of 13%.
Distribution of U.S. Rental Units
Occupied Rental Housing Units by Asset Class
Single-Family Homes Play a Bigger Role in the Rental Market
36%
19%
32%
13%
Single-Family Units
Duplex-Quadruplex
Buildings (2-4 Units)
Small Apartment
Buildings (5-49 Units)
Large Apartment
Buildings (50 Units or
More)
Source: Arbor Chatter, Chandan Economics, American Community Survey, 2016
https://arbor.com/blog/multifamily-single-family-rentals/
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The 2015-16 year-over-year percent growth
for multifamily units at 1.0% was double
that of single-family rental homes, while
duplex-quadraplex units shrank further.
At the same time, the 2015-16 percent
growth for multifamily units was
significantly slower compared to the
previous year (2014-15) at 2.3%, while
being faster for single-family rental homes.
Growth of Rental Units by Asset Class
Year-Over-Year, Annual Growth Rate
0.0%
-0.2%
2.3%
0.5%
-0.5%
1.0%
-1.0%
0.0%
1.0%
2.0%
3.0%
Single-Family Duplex-Quadruplex
Buildings (2-4 Units)
Multifamily Units
2014-15 2015-16
Single-Family Homes Play a Bigger Role in the Rental Market
Source: Arbor Chatter, Chandan Economics, American Community Survey, 2016
https://arbor.com/blog/multifamily-single-family-rentals/
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The recent relative slowing down of the
multifamily segment is due to the ongoing
shift toward large apartment buildings and
away from smaller properties.
While inventory in large buildings grew by
5.4% over 2015-16, small buildings showed
a slight decline of 0.7% over this time.
Growth of Rental Units within the Multifamily Segment
Year-Over-Year, Annual Growth Rate
1.9%
3.3%
-0.7%
5.4%
-1.5%
0.0%
1.5%
3.0%
4.5%
6.0%
Small Apartment Buildings
(5-49 Units)
Large Apartment Buildings
(50 Units or More)
2014-15 2015-16
Single-Family Homes Play a Bigger Role in the Rental Market
Source: Arbor Chatter, Chandan Economics, American Community Survey, 2016
https://arbor.com/blog/multifamily-single-family-rentals/
25. Top Reasons Why Renters Move
into Small Apartment Buildings
February 6, 2018
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The share of residents in small buildings
who moved over the previous year
decreased from 34% in 2010 to 29% by
2015. In comparison, recent movers
comprised a 26% share of the all residents
in large buildings in 2015, down from 29%
in 2010.
This can be compared to the overall
population moving rates of around 15%
over this period (including all movers from
outside the U.S. into the US).
New Movers in Apartment Buildings
Individuals Who Moved Within the Last Year, Including Immigrants
Top Reasons Why Renters Move into Small Apartment Buildings
34%
29%
15%
29%
26%
15%
0%
10%
20%
30%
40%
Small Apartment
Buildings
Large Apartment
Buildings
U.S. Overall
2010 2015
Source: Arbor Chatter, Chandan Economics, American Community Survey, 2015
https://arbor.com/blog/reasons-renters-move-small-apartment-buildings/
27. Arbor Chatter Multifamily Research
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The top three reasons for recent movers
(within two years) in small apartment
buildings included ‘Forming Own
Household’ (33%), ‘For a Better
Neighborhood’ (27%), and ‘For a Better
Home’ (25%). Note that these reasons are
not mutually exclusive.
In contrast, the top reasons for recent
movers in large buildings include ‘For a
Better Neighborhood’ (29%), followed by
an even 25% choice of ‘For a Better Home’,
‘To be Close to Family’, ‘For a New Job or
Transfer’ and ‘Forming own Household’.
Interestingly, commuting does not show up
as one of the top reasons for moves.
Reasons for Moving into Present Unit
Survey Respondent who Moved within the Last Two Years
Top Reasons Why Renters Move into Small Apartment Buildings
23%
33%
21%
18%
25%
20%
27%
25% 25% 25%
17%
25%
19%
29%
0%
10%
20%
30%
40%
For New Job
or Transfer
Forming Own
Household
To be Close
to Family
Reduce
Commute
Time
For Better
Home
Reduce
Housing
Costs
For Better
Neighborhood
Small Apartment Buildings Large Apartment Buildings
Source: Arbor Chatter, Chandan Economics, American Community Survey, 2015
https://arbor.com/blog/reasons-renters-move-small-apartment-buildings/
28. How Do Small Building Renters
Find Their Apartments?
January 25, 2018
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The most popular search modes employed
by new small building renters (who moved
within the previous two years) included
‘Word of Mouth’ (39%). This was followed
by the Internet (37%), and to a much
smaller extent, ‘Sign Outside Building’
(15%).
New large building renters employed
similar search modes while utilizing real
estate agents to a slightly higher degree.
Large buildings seem to benefit more from
personal recommendations compared to
Internet searches (10% spread) compared
to small buildings (2% spread). This is likely
due to the aggressive referral programs in
place with existing renters.
Mode of Apartment Search of New Movers
Individuals Who Moved within the Last Two Years
How Do Small Building Renters Find Their Apartments?
39%
37%
7%
5%
9%
15%
41%
31%
5%
8%
10%
14%
0%
10%
20%
30%
40%
50%
Word of Mouth Internet Newspaper or
Publication
Real Estate Agent Rental Agency
Listing
Sign Outside
Building
Small Apartment Buildings Large Apartment Buildings
Source: Arbor Chatter, Chandan Economics, American Community Survey, 2015
https://arbor.com/blog/small-building-renters-find-apartments/
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While small and large buildings follow
similar search mode preferences in the
aggregate, the story is more nuanced when
examining the purpose behind the move.
The Internet is by far the most popular
search mode among renters following new
jobs or transfers. This data makes sense
considering the short time spans, lack of
personal networks in new locations, and
higher use of real estate agents in large
buildings with deeper commissions.
Apartment Search Modes of Those Moving for Jobs
Individuals Who Moved within the Last Two Years
How Do Small Building Renters Find Their Apartments?
23%
45%
3%
4%
10%
15%
22%
39%
0%
11% 11%
16%
0%
10%
20%
30%
40%
50%
Word of Mouth Internet Newspaper or
Publication
Real Estate Agent Rental Agency
Listing
Sign Outside
Building
Small Apartment Buildings Large Apartment Buildings
Source: Arbor Chatter, Chandan Economics, American Community Survey, 2015
https://arbor.com/blog/small-building-renters-find-apartments/
31. Arbor Chatter Multifamily Research
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Renters who seek to move close to family
rely heavily on referrals across apartment
building type. This is most likely based on
leads from other family members and
friends in the neighborhood.
Small building operators can leverage
multiple avenues to attract new renters.
Strategies to prioritize should include
effective referral initiatives and better use
of Internet rental listing services.
Apartment Search Modes of Those Moving to Be Close to Family
Individuals Who Moved within the Last Two Years
How Do Small Building Renters Find Their Apartments?
40%
26%
6%
2% 8%
18%
48%
12%
8%
6%
9%
16%
0%
10%
20%
30%
40%
50%
60%
Word of Mouth Internet Newspaper or
Publication
Real Estate Agent Rental Agency
Listing
Sign Outside
Building
Small Apartment Buildings Large Apartment Buildings
Source: Arbor Chatter, Chandan Economics, American Community Survey, 2015
https://arbor.com/blog/small-building-renters-find-apartments/
33. Arbor Chatter Multifamily Research
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The recent interest in apartment
development has focused on areas in close
proximity to existing and expanding
regional public transportation hubs (transit-
oriented development). This means that
suburban apartment renters are also likely
to own fewer cars going forward.
Nearly 85% of all households in suburban
areas owned a vehicle in 2015. Nearly 30%
owned two or more cars. Car ownership
was only about 66% in urban areas.
Vehicle ownership rates are skewed to
more cars across all households. For
homeowners with driveways and garages,
there are fewer hindrances to car
ownership. 53% of all households in the
Top 15 metros had two or more cars.
Car Ownership of Small Apartment Households
For Top 15 Metros, Distribution of All Housheolds by Location
Suburban Apartment Renters Shifting Slightly Away from Vehicle Ownership
33%
15%
13%
46%
55%
34%
21%
29%
53%
0%
10%
20%
30%
40%
50%
60%
In Urban Locations In Suburban Locations All MSA Households
(Owner and Renter)
No Car One Car Two Cars or More
Source: Arbor Chatter, Chandan Economics, American Community Survey, 2015
https://arbor.com/blog/suburban-apartment-renters-away-vehicle-ownership/
34. Arbor Chatter Multifamily Research
33ARBOR.COM • 800.ARBOR.10
While car ownership rates are relatively
higher in suburban areas, these locations
are also witnessing an increase in
households not owning vehicles at an
annual rate of 1.0%. In urban areas, the
reverse was surprisingly true.
The data also shows that households
owning just one car grew at a lower annual
rate of 3.7% in suburban areas, compared
to 5.4% in the urban core.
However, suburban areas are also
witnessing an increase in households with
two or more vehicles, keeping consistent
with the historical norm.
Growth in Car Ownership of Small Apartment Households
For Top 15 Metros, Distribution of All Housheolds by Location
Suburban Apartment Renters Shifting Slightly Away from Vehicle Ownership
-1.4%
1.0%
5.4%
3.7%3.8%
7.5%
-2.0%
0.0%
2.0%
4.0%
6.0%
8.0%
Urban Locations Suburban Locations
No Car One Car Two Cars or More
Source: Arbor Chatter, Chandan Economics, American Community Survey, 2015
https://arbor.com/blog/suburban-apartment-renters-away-vehicle-ownership/
36. Arbor Chatter Multifamily Research
35ARBOR.COM • 800.ARBOR.10
Commute Choice of Renters
Top 15 Metros, Working Renters, 16 years or Older
Public Transportation Picking Up Among Suburban Apartment Renters
59%
27%
7%
2% 5%
81%
10%
4%
0%
5%
0%
25%
50%
75%
100%
Drove Public
Transport
Walked Biked All Other
Urban Locations Suburban Locations
Source: Arbor Chatter, Chandan Economics, American Community Survey, 2015
https://arbor.com/blog/public-transportation-suburban-renters/
Given the concentration of the largest apartment developments in expensive and transit rich locations, small building renters have
comparatively higher rates of driving to work – 12% higher in urban locations and 5% higher in suburban areas compared to larger
buildings.
Also shown in the data is that public transportation remains crucial for apartment renters living in urban locations across both small and
large buildings, with more than twice as many individuals relying on public transit that what is seen in the suburbs.
Small Buildings
47%
33%
12%
1%
7%
76%
13%
4%
1%
6%
0%
25%
50%
75%
100%
Drove Public
Transport
Walked Biked All Other
Urban Locations Suburban Locations
Large Buildings
37. Arbor Chatter Multifamily Research
36ARBOR.COM • 800.ARBOR.10
Suburban areas are also showing signs of
departure from historical trends, as more
renters now appear amenable to public
transportation.
Small building renters choosing public
transportation in suburban areas grew at
an annual rate of 16% between 2014 and
2015, compared to only 3% for driving.
Walking to work also grew faster at an
annual rate of 7%.
Growth in Commute Choice of Renters in Small Buildings
Top 15 Metros, Average Annual Growth Rate, Working Renters, 16 years or Older
6%
1%
5%
3%
16%
7%
0%
5%
10%
15%
20%
Drove Public Transport Walked
Urban Locations Suburban Locations
Public Transportation Picking Up Among Suburban Apartment Renters
Source: Arbor Chatter, Chandan Economics, American Community Survey, 2015
https://arbor.com/blog/public-transportation-suburban-renters/
38. Need for Higher Speeds: An
Updated Look at Internet Usage in
Small Apartment Buildings
January 2, 2018
ARBOR.COM • 1.800.ARBOR.10
39. Arbor Chatter Multifamily Research
38ARBOR.COM • 800.ARBOR.10
While Internet access makes steady inroads
in small apartment buildings, renter
preference for faster connectivity is shifting
access to newer technologies.
Data for end-year 2015 shows that about
76% of all households in small apartment
buildings reported some form of access to
the Internet (paid and unpaid), up 3% since
2014, as shown below.
In comparison, large apartment buildings
had slightly lower levels of connectivity
with a 70% share of all households having
Internet access. This is explained by a mix
of market-rate and non-market-rate units.
Level of Internet Access by Building Size
Percentage of Housheolds within Asset Class
73%
67%
76%
70%
60%
64%
68%
72%
76%
80%
Small Apartment Buildings Large Apartment Buildings
2014 2015
Need for Higher Speeds: An Updated Look at Internet Usage in Small Apartment Buildings
Source: Arbor Chatter, Chandan Economics, American Community Survey, 2015
https://arbor.com/blog/internet-usage-small-apartment/
40. Arbor Chatter Multifamily Research
39ARBOR.COM • 800.ARBOR.10
While levels of access are on the rise across
the apartment sector, faster speeds are
more sought after, as reflected in the type
of paid access.
Cable internet was the most popular mode
of connectivity in small buildings, with a
presence in 70% of all households. This was
followed by mobile broadband at 50% –
levels that are similar in large buildings.
Fiber optic currently serves only 9% of all
small apartment building households. This
figure can be compared to 12% in large
buildings.
Type of Access with Subscription
Percentage of Households with Paid Access, Overlap between Fixed and Mobile Internet
9%
69%
15%
3%
50%
2%
12%
70%
15%
3%
48%
2%
0%
20%
40%
60%
80%
Fiber Optic Cable Internet DSL Satellite Mobile Internet Dial-Up Service
Small Apartment Buildings Large Apartment Buildings
Need for Higher Speeds: An Updated Look at Internet Usage in Small Apartment Buildings
Source: Arbor Chatter, Chandan Economics, American Community Survey, 2015
https://arbor.com/blog/internet-usage-small-apartment/
41. Arbor Chatter Multifamily Research
40ARBOR.COM • 800.ARBOR.10
The year-over-year growth of access types
indicates a preference for faster
connectivity and decrease in more
antiquated technologies.
The household adoption of cable and
mobile access grew by 2 percentage points
since 2014, while fiber optics increased
slightly below 1%. This is contrasted to the
decline in the usage of DSL by 2 to 3%
points across apartments. Note that mobile
technology has moved into third place in
terms of speed, behind fiber and cable.
Growth in Paid Internet Access Type by Household : 2014-15
Percentage Points Change in Access Type, Fixed and Mobile Access not Mutually Exclusive
0.6%
2.1%
-2.2%
2.0%
0.9%
1.2%
-3.0%
1.5%
-4.0%
-2.0%
0.0%
2.0%
4.0%
Fiber Optics Cable Internet DSL Mobile Internet
Small Apartment Buildings Large Apartment Buildings
Need for Higher Speeds: An Updated Look at Internet Usage in Small Apartment Buildings
Source: Arbor Chatter, Chandan Economics, American Community Survey, 2015
https://arbor.com/blog/internet-usage-small-apartment/
42. ARBOR.COM | 800.ARBOR.10
About Us
For over 20 years, Uniondale, NY-based Arbor Realty Trust, Inc. (NYSE: ABR) has been helping multifamily and commercial
real estate clients achieve their financial goals by focusing on growing long-term relationships and conducting business as
not simply another real estate lender, but a partner. We value our clients to such an extent that we’re more comfortable
calling them partners, and their relationships with Arbor are the foundation of our business.
Founded by Chairman and CEO Ivan Kaufman, Arbor Realty Trust, Inc. is a real estate investment trust and direct lender
specializing in loan origination and servicing for multifamily, seniors housing, healthcare and other diverse commercial
real estate assets. Arbor is a Top 10 Fannie Mae DUS® Multifamily Lender by volume and the Top Fannie Mae Small Loan
Lender, a Freddie Mac Seller/Servicer and a Top Freddie Mac Small Balance Loan Lender, a Fannie Mae and Freddie Mac
Seniors Housing Lender, an FHA Multifamily Accelerated Processing (MAP)/LEAN Lender, a HUD-approved LIHTC Lender
as well as a CMBS, Bridge, Mezzanine and Preferred Equity lender, consistently building on its reputation for service,
quality and flexibility. With a multibillion-dollar servicing portfolio, Arbor is a primary commercial loan servicer and
special servicer rated by Standard & Poor’s with an Above Average rating. Arbor is also on the Standard & Poor’s Select
Servicer List and is a primary commercial loan servicer and loan level special servicer rated by Fitch Ratings.
The research contained in this report should not be construed as a solicitation to and/or trade. All opinions, news,
research, analyses, prices or other information is provided as general market commentary and not as investment advice;
all information is subject to change. Arbor, its members, shareholders, employees, agents and representatives do not
warrant the completeness, accuracy or timeliness of the information supplied, and shall not be liable for any loss or
damages, consequential or otherwise, which may arise from the use or reliance on the content contained herein. Past
performance is not indicative of future performance.
The American Community Survey (ACS) is the primary source of statistics on the nation's demographic, housing and
socio-economic characteristics. Data in this annual survey is collected on a year-long basis and released through summary
tabulations on the American FactFinder and the Public Use Microdata Sample (PUMS) data files in the year following the
survey. The ACS differs from the Decennial Census in that it is not a total count of the entire US population, but rather a
random sample of covering approximately 3.5 million households every year. At the same time, it is the only official
Census program that provides detailed data on demographic, housing and socio-economic characteristics on a
continuous basis, having replaced the Decennial Census long form completely. The ACS data is released in three time-
period versions, including the 1-year, 3-year and 5-year estimates. Because it is a sample survey, when arriving at
numbers for the total population, the ACS sample-based estimates include a margin of error (MOE) range. The Arbor-
Chandan research series provides analysis of the ACS 1-yr dataset on an as-is basis for more current review of
housing statistics.