read article and answer the following questions in essay for…

read article and answer the following questions in essay form.
According to the article, what are 2 pieces of evidence or expectations that suggest that the apartment property market will soften in 2023?
2. What happened with apartment rents after the introduction of COVID-19 vaccines in late 2020? Describe why rents changed as they did.
3. Why might apartment rents decline in 2023?
4. In what type of buildings are apartment rents expected to be most likely to decline? Why?
5. What is one reason that could increase ones optimism about the apartment rental market in 2023?
6. Why are higher interest rates relevant for apartment owners who want to be able to increase rent?1/10/23, 5:30 PMApartment Rent Growth Set to Keep Slowing This Year – WSJ copy is for your personal, non-commercial use only. Distribution and use of this material are governed by our Subscriber Agreement and by copyright law. Fornon-personal use or to order multiple copies, please contact Dow Jones Reprints at 18008430008 or visit ESTATEPROPERTY REPORTApartment Rent Growth Set to Keep SlowingThis YearTenants maxed out on rental spending combined with new apartment supply areexpected to moderate increasesThe West River apartment complex in Tampa, Fla. A slowdown in rental price increases would bring relief to manytenants whose wages arent keeping pace with rents.PHOTO: OCTAVIO JONES FOR THE WALL STREET JOURNALBy Will ParkerFollowJan. 3, 2023 800 am ETThe pandemic-fueled boom for multifamily building owners is fading fast going into 2023.?Apartment vacancies are piling up. The biggest wave of new rental buildings in nearly fourdecades is expected to cut the pace of rent growth across the country. Some in-demandSunbelt cities are already experiencing rent declines, in part because many tenants andpeople searching for apartments feel they cant devote any more of their income to rent.Rising interest rates, meanwhile, make rental-property investments less profitable than oneyear ago when debt was cheap and hefty rent increases were taken for granted.Were necessarily going to get a bit of a pullback,? said Thomas LaSalvia, senior economist atMoodys Analytics.?1/10/23, 5:30 PMApartment Rent Growth Set to Keep Slowing This Year – WSJ rent growth would help curb general inflation while bringing relief to many tenantswhose wages already werent keeping pace with rents. Of the 44 million households that rent,more than 19 million spent 30% or more of their income on rent and other housing costs,according to a December report from the U.S. Census Bureau that estimated spending from2017 to 2021.?Completed new construction apartments,annuallySource: CoStarNote: 2022 and 2023 igures are forecasts1/10/23, 5:30 PMApartment Rent Growth Set to Keep Slowing This Year – WSJ reversal comes after an unprecedented run for the apartment and home rental industrythat most housing economists say was shaped by the pandemic. Early lockdowns createdpent-up demand for housing that later exploded in the months after the introduction ofCovid-19 vaccines in late 2020. Many young people went out to rent their first home, and thesudden increase in people searching for apartments helped rents climb 25% over two years.?In particular, well-paid workers from the Northeast decamped for growing cities in theSunbelt, where they could work remotely and where their higher incomes commanded morespace.Now, many of those same places that shot up in price are seeing slides in demand and rentsare going down. Between April and October of 2022, rents fell 3% in Las Vegas, 2% in Phoenixand 1% in Tampa, according to Apartment List. All three of those cities saw rents rise morethan 30% during the preceding two years.?If migration and new household formation continue to slow, analysts said some markets couldsee a full 12 months of negative rent growth starting sometime this year.?Meanwhile, nearly half a million new apartment units?the most of any year since 1986?areexpected to complete construction by the end of 2023. That will come after more than400,000 units were completed during 2022, according to an analysis by property data firmCoStar Group Inc. The addition of so many new apartments to slowing housing markets isexpected to help keep a lid on rent growth.?1/10/23, 5:30 PMApartment Rent Growth Set to Keep Slowing This Year – WSJ apartment rents, monthlySource: Apartment List median rent estimates1/10/23, 5:30 PMApartment Rent Growth Set to Keep Slowing This Year – WSJ cities with higher than average construction activity could even see full year rentdeclines, said Je? Adler, vice president in the data division of property technology companyYardi Systems Inc. He cited Miami, Austin, Texas, and Raleigh, N.C., as places with anespecially large amount of new supply expected to open this year.The coming increase in new apartments is most likely to a?ect rents at higher-end buildings,because there might not be enough people who make enough money to rent them, accordingto CoStar.The potential demand for newly developed [high-end] properties remains dependent on anexpanding pool of high income renter households only,? CoStar said.Amid rising concerns of a recession, many housing economists dont think job and wagegrowth will be strong enough to sustain much in the way of rent increases this year. BothYardi and Moodys expect rents to rise about 3% nationally during the next 12 months, lessthan half the rate seen in 2022.When you look at real wages, you saw that they were pretty darn stagnant for the last year ortwo years,? Mr. LaSalvia said.?Some tailwinds remain for the rental sector, however. Higher mortgage interest rates andhigh home-sales prices mean fewer people can buy their first home, bolstering demand forrental houses and apartments. Despite the expected increase in new rental buildings, mostanalysts think the majority of cities will remain undersupplied with the kind of a?ordableunits that see the highest demand. Such factors should help keep vacancies from rising toomuch and keep rents from going negative in most cities, analysts said.?If there is a recession, history shows that the rental sector handles bear markets better thanother parts of the economy, where consumers are more likely to cut back their spending.?Rent eats first,? Mr. LaSalvia said.Even so, investors are adjusting their expectations to the more challenging environment.?In 2021 and into early 2022 you could raise rents significantly without doing a lot to theproperty itself,? said Karlin Conklin, principal of apartment landlord Investors ManagementGroup, which owns buildings in the Sunbelt and on the West Coast. We dont see thathappening going forward.??1/10/23, 5:30 PMApartment Rent Growth Set to Keep Slowing This Year – WSJ in the January 4, 2023, print edition as ‘Apartment Rents Growth Slows Down’.Borrowing the money to make investments in existing rental properties, such as renovatingthem to be more attractive to higher-paying tenants, has become more expensive because ofrising interest rates. Sales of apartment buildings are falling as a result. Building sales inNovember, as measured by total dollar value, were 74% below their levels during the samemonth the previous year, according to a report from MSCI Real Assets.?The incentives for apartment investing have changed,? the report noted.Write to Will Parker at [email protected] Plagiarism Free Papers
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