Rental Market

Chittenden County Rental Market 2016 Outlook


While apartment hunting in Northwest Vermont remains competitive, renters are in a better position than a year ago, thanks to a higher vacancy rate and stabilizing rents. The following are some trends that are impacting the rental market:

Vermont Rental Market 2016The Vacancy Rate Is Easing

The vacancy rate stood at 3% in December, almost double the 15-year average of 1.6%, according to real estate consulting firm Allen & Brooks. With 3,500 new apartments being constructed across Chittenden County, that’s providing more options for renters, such as Finney Crossing in Williston and Riverrun in Winooski. Almost 600 new apartments will open in 2016 alone, Allen & Brooks forecasts.

Renters Have More Choices

With developers opening new apartment buildings, renters have more options, such as whether to look for a recently constructed building or housing in the older homes found in the Old North End of Burlington, for instance. Our Agents find that the rents are often comparable, although the newer buildings often include amenities – such as covered parking – that aren’t available with older apartments.

More Wiggle Room with Rents

Because of the higher vacancy rate and new apartments coming to the market, renters are finding some financial breathing room after 15 years of annual average increases of 3.1%. Monthly rents are stabilizing, and our Agents believe that rents may see some softness in coming months.

Prepare to Search Two Months Before a Move

Our Agents advise renters to start searching for a new apartment 45 days to 60 days before they need to move. Landlords typically market their apartments within that time frame, and hunting for a new home can still be competitive.

A Vibrant Local Economy

Large local employers such as the UVM Medical Center continue to hire, while industries such as the technology sector are growing and adding workers. Relocating families and professionals often want to rent before committing to buying, which is adding to demand for rental properties.


Chittenden County’s Rental Market Insights

  • The county’s vacancy rate is 3%, significantly below the national average of 4.4%.
  • Rents have increased 3.1% annually since 2001.

New Interest in Old Neighborhoods

Professionals are increasingly drawn to the Old North End of Burlington because it’s within walking distance to downtown and offers more affordable rents than other neighborhoods, Allen & Brooks notes. Likewise, Winooski has earned a reputation as “The Brooklyn of Vermont” because of its excellent new restaurants and cheaper rents, which is drawing more professionals to the city. Developers are responding by constructing higher-end buildings in these areas, such as the Packard Lofts in the Old North End and Riverrun in Winooski.

Because our rental expert has extensive contacts with landlords, Realtors and associations, Coldwell Banker Hickok & Boardman Realty is well positioned to help clients find the most recent properties on the market.

 

Northwest Vermont’s real estate market is enjoying a period of healthy gains in pricing and demand.

Market results & real estate trends to watch for Chittenden, Franklin, Grand Isle & Addison Counties. January — December 2015.CBHB_Vermont_Winter_2016

The local economy continues to be healthy, lifted by hiring at employers including Dealer.com and University of Vermont, while industries such as healthcare, technology, and education remain vibrant. Dozens of technology start-ups are hiring and attracting mid-career professionals from out of state, as well as hiring graduates from local colleges such as Champlain College and UVM.

The unemployment rate in Vermont stood at 3.7 percent in November, one of the lowest in the country. Our region’s jobless rate was even lower, with Chittenden County’s unemployment rate reaching a 15-year low of 2.5 percent during the same month.

Millennials are entering the property market, with that generation on track to become the country’s largest home-buying demographic within the next few years, according to real-estate data service Zillow. In Vermont, younger consumers are emerging as first-time buyers, thanks to record low interest rates and relatively high rents, which makes home-buying a more attractive alternative. A Coldwell Banker Hickok & Boardman Realty survey last year found 37% of our clients had just purchased their first home, close to historic rates of 40% for first time buyers.

While the Federal Reserve increased short-term interest rates in December, the central bank has signaled that future rate hikes will be incremental. Mortgage rates may reach between 4.7% to 5% by year-end, compared with below 4% currently, according to the National Association of Realtors. Mortgage rates remain historically low, and our Realtors haven’t noted any impact on housing demand from the Fed’s move.

Housing in the $250,000 to $350,000 range remains the sweet spot in our market, especially given the emergence of first-time millennial homebuyers. Property in the over-$500,000 range, however, can take longer to sell, and inventory in the upper ranges has been growing because of affordability issues. The luxury segment, or properties priced above $800,000, now has a three-year supply of inventory.

While the overall property market remains stable, there are a few issues that bear noting, including rising concern over affordability and property taxes. Vermont’s housing ranks among the most expensive in the country, but incomes in the state remain relatively low, creating a financial crunch for some buyers and property owners. Vermont also has one of the highest property tax burdens in the country, according to the Tax Foundation. Legislators are taking action intended to support quality outcomes for students and make costs more sustainable.

Homebuyers and property owners are advised to keep an eye on Act 46, the education governance reform law passed last year that calls for larger school districts. That could impact some towns in our region, such as Essex, Essex Junction and Westford, which late last year voted to consolidate into one school district. It is important for homebuyers to reach out to school administrators in the town they are considering with any questions. We find public and private schools have always welcomed conversations with perspective families considering a move to the area.

The National Association of Realtors forecasts a median price increase of 4% to 5% and existing home sales rising 1% to 2% in 2016.

 

Locally, Coldwell Banker Hickok & Boardman Realty is forecasting continued steady growth in pricing and sales for 2016, after last year’s 12% gain in residential transactions and 3.4% boost to the region’s median sale price.

As for sellers preparing their home for sale, Coldwell Banker Hickok & Boardman Realty recommends taking care of deferred maintenance issues prior to listing. Also, consider installing new “smart home” technology. These devices are relatively affordable, and consumers are increasingly embracing the technology, according to a joint survey from Coldwell Banker and technology site CNET. On top of that, smart devices such as Nest’s thermostat can help save money by conserving power and water, which will make your home even more appealing to buyers.

As always, it remains that both sellers and buyers need to reflect on their personal situation. Utilizing the local knowledge within this report and the advice of your agent – you can make an informed decision about your next move.

Northwest Vermont Housing Market Report for 2015

Luxury Market

The Vermont Vermont Luxury Home Market picked up in 2015
1100’ of private waterfront. Premier Estate on Shelburne Point. MLS#4250678

 

Luxury properties in Northwest Vermont span a variety of styles and locations, from classic Vermont farmhouses on mountain estates to award-winning modern properties perched on Lake Champlain.

Sales of properties above $800,000 picked up in 2015, with our Realtors noting that 2015’s luxury home sales represented an increase of more than 25 percent from a year earlier. Additional sales in 2015 may fuel future activity by providing market comparables that help support purchaser’s decision making and provide appraisers with current market sales.

Even with the increased activity, the luxury segment still remains a buyer’s market, given that our region has a three-year inventory of homes listed for more than $800,000. In Coldwell Banker Hickok & Boardman Realty’s experience, high-end homes can potentially require years to find a buyer, and many sellers have had to lower their price expectations. In some cases, luxury homes have sold below their assessed value.

While that isn’t heartening for sellers, it represents an opportunity for buyers, given the wide range of choices currently on the market and the potential to negotiate a lower price.

Inventory Concerns

Given the three-year inventory, some prospective buyers are increasingly cautious about purchasing homes in the above-$800,000 range, given that it may take them years to sell if they later decide to move. Senior executives who are more mobile are finding this to be a concern.

Resurgence of “In-Town” Properties

Buyers are increasingly looking for high-end homes that are close to Burlington and its amenities such as restaurants and the Flynn Center for the Performing Arts. Estates with mountain views and large acreage have also proved popular.

Pristine Condition

Given the choices available to luxury buyers, buyers are seeking properties with no deferred maintenance issues. Homes that show well – such as those that have been repainted recently, have no clutter, and excellent landscaping – are also performing better with buyers.


 

Market Insights

• Thirteen, or about 38%, of last year’s $800,00-plus home sales provided waterfront access.
• Almost two-thirds of the year’s luxury sales were located in Chittenden County.

2015 Vermont Luxury Home Market Report

Franklin County

Franklin County Housing Market 2015
Beautiful Franklin County home for sale.
County Averages   
Median Sale Price:Units Sold:Newly Listed:Days on Market:
$188,500 (+1.9%)517 (+6.4%)1034 (-3%)122

Franklin County Housing Market in 2015Franklin County’s real estate market benefited from an uptick in demand, fueled by homebuyers seeking homes in the sub-$200,000 price range. Lower prices at the gas pump have helped make the county a more affordable option for professionals who commute into Chittenden County or other locations.

Nevertheless, our Realtors have noted that the property market is a “tale of two counties.” Towns in the western section of the county are generally seeing stronger demand, thanks to their proximity to the interstate. Pricing and demand has tended to be weaker for towns located in the more remote eastern part of the county.

Quick Commutes

As noted above, towns closer to I-89 have witnessed stronger pricing trends and demand, such as Fairfax, where the median sale price rose 7.5% in 2015. Some towns to the east, which are farther from the interstate, saw a dip in median pricing.

Regional Affordability

Franklin County’s median sale price is the lowest in Northwest Vermont, which makes it an affordable option for professionals seeking single-family homes in the sub-$250,000 range. Properties also often offer more land and space than in neighboring Chittenden County, which appeals to some buyers.

Employers Are Hiring

Businesses such as pharmaceutical company Mylan and logistics company A.N. Deringer are hiring, bringing new professionals into Franklin County.

 


Franklin County, Vermont 2015 Market Snapshot

Thirty-one land sales were recorded last year, slightly less than 2014’s 34 land transactions. While demand was slow during the start of the year, when abnormally cold temperatures kept buyers out of the market, land sales picked up in the summer and fall. The median sale price for land parcels rose 36% to $70,000.

The multi-family market dropped slightly, with 18 sales last year, compared with 25 a year earlier. Still, the median sale price jumped 33%, reaching $214,300.

 

Multi-Family Market

Vermont-Multi-Family-Housing-Market
Burlington 4 Unit. A unique find. MLS#4452662          |       Exceptional Burlington Triplex MLS#4441124
Multi-Family Averages   
Median Sale Price:Units Sold:Newly Listed:Days on Market:
$288,250 (-2.8%)120 (-3.2%)243 (0.8%)88

Northwestern Vermont’s multi-family market remains competitive, given tight inventory levels and continuing interest from Vermont-based and out-of-state investors.

While in four counties combined, the median sale price slipped 2.8% and transaction volume declined 3.2%, Chittenden County had a 6.5% increase in the number of multi-family properties sold. While the number of sales and the median sales price were slightly lower in 2015, that was largely due to a tough comparison with 2014, when two large multi-family portfolios went on the market and several very expensive properties were sold.

 

Vermont Multi-Family Housing Market

 

 

A continuing issue for the multi-family market is a lack of available inventory, especially in Burlington, the most active market for investment properties. Our Realtors note that properties that are in good condition and in prime locations continue to sell quickly.

About 3,500 new apartments are either pending or have been built recently in Chittenden County, which may bring the vacancy rate higher and continue to stabilize rents, according to Allen & Brooks.

There will likely be continued growth in the renter market, however. Median household incomes in the Burlington area are about 7 percent below their 2008 peak, and many younger professionals are dealing with high amounts of student debt. That may crimp their ability to purchase homes and lead to more demand for rental housing, Allen & Brooks notes.


Vermont Multi-Family Sale Prices in 2015A Higher Vacancy Rate

The rental market’s vacancy rate has seen some easing in recent months due to new apartment building construction. It now stands at about 3 percent in Chittenden County, or almost double the rate from a year earlier. Our Realtors have noted that while investors are keeping an eye on the trend, it hasn’t impacted pricing for multi-family properties. .

Demand for Winooski properties

Investors are increasingly searching for multi-family properties in this town thanks to demand from professionals who are drawn to its revived downtown area and lower costs than neighboring Burlington. Multi-family sales in Winooski rose 28% last year.

Rents Remain High

With vacancy rates still relatively tight, rents continue to rise across Chittenden County. Across all apartment sizes, rents rose 2.9% in 2015, according to real-estate consulting firm Allen & Brooks. Still, given that recently constructed apartment buildings are offering more choice to the region’s renters, our agents have seen some recent stabilization in rents.

 

Grand Isle County

Come home to country living & lake views in South Hero. MLS#4451102
South Hero home, come home to country living & lake views. MLS#4451102
County Averages   
Median Sale Price:Units Sold:Newly Listed:Days on Market:
$200,00 (-14.5%)126 (+18.9%)304 (+5.9%)171

2015 Grand Island Housing Market ChartWith gas prices declining dramatically last year, more buyers looked to Grand Isle for residential properties. Despite the higher number of property sales, our agents have noted a lack of strong inventory in the higher price ranges, as well as fewer luxury buyers in the market

Because of those trends, property sales last year were focused on mid-priced homes. The median sale price slipped 14.5 percent to $200,000, reflecting that trend. The number of residential sales, however, rose 18.9 percent during the year.


Mid-Priced Housing

The market is increasingly focused on mid-priced single-family homes. South Hero and parts of Grand Isle town have been attractive to buyers who work in Chittenden County, given the short commute time and proximity to I-89.

Four Luxury Sales

While Grand Isle is known for its high-end waterfront property, the county only recorded four sales above $800,000 last year. By comparison, Addison County recorded eight, and neighboring Chittenden County recorded 22 sales.

A Small Market

As Grand Isle is the smallest real estate market by volume in Northwest Vermont; a few sales can have a big
impact on median sale prices or volume.

Twelve land sales were recorded in 2015, slightly down from 17 in 2014. The median sale price declined 58% to $54,375.

2015 Grand Isle County Real Estate Market Snapshot

Chittenden County

Chittenden County Housing Market Report
Lake and seasonal mountain views in Shelburne. MLS#4442398
County Averages   
Median Sale Price:Units Sold:Newly Listed:Days on Market:
$269,900 (+3.1%)1970 (+14.9%)2720 (+2.3%)78

Chittenden County, the most active real estate market in our region, recorded significantly more residential sales in 2015, thanks to stronger local and national economies and record low interest rates. Median sale prices rose 3.1 percent, representing a healthy and sustainable increase.

2015 Chittenden County Housing Market

 

Above-average temperatures during the fall helped maintain some buyers’ interest in pursuing their home searches, capping off what had been a strong spring and summer. Typically, colder weather can lead to some home buyers curtailing their searches until spring returns.

Burlington continues to draw homebuyers, including first-time buyers and those looking to move into bigger properties or downsize. The city’s residential sales surged by 22.5% last year, making it one of the county’s most active towns. Still, the median sale price slipped by 2.2%, reflecting demand for lower-priced inventory in the New North End and Old North End. Our Realtors also note that some Burlington sales represented older homes with deferred maintenance, which provided buyers with greater bargaining power and opportunity to build equity.

2015 Chittenden County Home Sale PricesStrong Demand for Mid-Priced Properties

Affordable homes in the $250,000 to $350,000 price range are in the sweet spot, given the emergence of first-time homebuyers who are seeking mid-priced properties as their entry into the property market.

More Inventory in the Over-$500,000 Segment

Even though the median household income in Chittenden County is about $64,000, or 18% higher than Vermont’s median income, that’s not enough to support the purchase of some higher-end homes. As a result, inventory in the over $500,000 is growing, providing more choices for executive-level buyers.

Vibrant Health, Tech, and Education Sectors

Chittenden County not only has big employers like Dealer.com, but a growing number of tech start-ups that are seeking to hire new employees in both entry-level and mid-career roles. Additionally, the UVM Medical Center and educational institutions such as Champlain College continue to hire, bringing new professionals and homebuyers into the market..

Proximity and Cost

While Burlington remains a popular property market, some buyers are seeking nearby towns that offer more space or lower prices. Milton, Winooski, Jericho, and Colchester are among the towns that recorded double-digit percentage increases in sales last year.


 

Chittenden County Real Estate Market Snapshot

 

The multi-family market recorded 98 sales last year, an increase of 6.5% compared with 2014. For a longer discussion of trends in this market, please see our multi-family section in the Mid-Year Market Report.

Fifty-two land parcels were sold in Chittenden County last year, little changed from 2014. The median sale price rose 6.8% to $133,500. Demand remains steady for lots where professionals and retirees can build custom-homes..

Northwest Vermont is continuing to witness healthy real estate demand

As the fall months arrive, Northwest Vermont’s property market is continuing to witness healthy real estate demand.

With the local economy continuing to grow and interest rates remaining at historically low levels, buyers are returning to the market, including an influx of first-time homebuyers. That has lifted residential home prices between 2% to 3% so far in 2015, which is representative of the type of healthy sales gains that were typical before the recession.

The region’s employment outlook remains healthy, thanks to hiring by local businesses such as Dealer.com and the University of Vermont. In August, the unemployment rate in Vermont stood at 3.6%, one of the lowest in the country. Economists at the Vermont Economic Outlook conference have forecast that 1,500 new jobs will be created in the state this year.

Those trends are bringing first-time homebuyers back into our market, especially as younger professionals seek to gain a foothold in the property market. The millennial generation, which now stands as the largest generational group in America, is expected to become the country’s biggest home buying demographic within the next five years, according to real-estate data service Zillow.

In the Northwest Vermont market, our agents are already seeing younger first-time homebuyers enter the market. A survey earlier this year of Coldwell Banker Hickok & Boardman Realty clients found that 37% had just purchased their first home, which is approaching typical levels of 40% of the market. On a national basis, the percentage of first-time homebuyers stood at 33% last year.

Economists now consider it less likely that the Federal Reserve will start raising interest rates this year, following a disappointing national jobs report in October. If the Fed opts out of boosting rates, it’s likely that mortgage rates will remain near historic lows for several more months.

Despite the solid outlook for our region, the property market is facing a few problematic issues, including affordability and rising property taxes. Residential property in the region remains expensive compared with wages, and increases in taxes have added to buyers’ concerns.

Despite those headwinds, Coldwell Banker Hickok & Boardman Realty is forecasting continued incremental growth in housing prices and steady demand for the remainder of 2015 and into 2016. For the first nine months of this year, the median sale price for residential property increased 2.9%, while the number of unit sales jumped 13.7%. That marks an improvement over 2014, when unit sales and pricing was little changed.

As always, it remains that both sellers and buyers need to reflect on their personal situation. It is increasingly important that you utilize the local knowledge within this report and the advice of your agent – to make an informed decision about your next move.


Coldwell Banker Hickok & Boardman Realty is forecasting continued incremental growth in housing prices and steady demand for the remainder of 2015 and into 2016.

The resurgent Northwest Vermont real estate market continued to demonstrate healthy pricing and demand during the third quarter, after a strong spring and early summer. Sales jumped 13.7% during the first nine months of 2015, with each of the region’s four counties recording more residential transactions than a year earlier. Across the four counties tracked in this report, the median sale price rose 2.9%.

Steady price increases in Chittenden County housing market

County Averages   
Median Sale Price:Units Sold:Newly Listed:Days on Market:
$269,900 (+2.8%)1495 (+17%)2321 (+2.1%)80

The real estate market in Chittenden County has demonstrated healthy conditions during the first nine months of 2015. Steady price increases in the 2% to 3% range represent sustainable gains, while pent-up demand from first-time homebuyers has resulted in a boost in activity this year.

During the summer and early autumn months, the real estate market has sustained the momentum that began after a slow winter, when our agents noted that below normal temperatures caused some sellers and buyers to defer their real estate plans until warmer weather and new inventory arrived.


Job Creation

Chittenden County has added 4,000 new jobs since 2007, before the recession started, according to University of Vermont economist Art Woolf. Local companies such as Dealer.com and WebGrocer are hiring, bringing new homebuyers into the market.

A Steady Economic Outlook

The state’s unemployment rate stood at 3.6% in August, one of the lowest in the country. Corporations in Vermont could add 1,500 private-sector jobs this year, according to a forecast from economists at the Vermont Economic Outlook Conference.

Wanted: Mid-Priced Properties

Affordable properties in the $250,000 to $350,000 price range are especially in demand, with first-time homebuyers returning to the market and driving competition for these properties.

Burlington Remains Desirable

Unit sales surged by 31%. Still, median pricing slipped 4.5% during the fi rst half of 2015, which indicates that buyers are seeking lower-priced housing. Affordability remains an issue in the Queen City and the surrounding areas.

Proximity and Cost

Because of the cost of housing in Burlington, some buyers are turning to nearby towns that offer either lower prices or more space. Winooski, Essex, and Colchester all witnessed an uptick in sales this year through September.

MARKET INSIGHTS
Median pricing rose 6.2% during the first six months of 2015.
Housing in Burlington remains in demand, with residential properties selling in an average of only 88 days on the market.
More affordable towns close to Burlington also saw an uptick in sales.

Chittenden_Table

The multi-family market recorded 72 sales in the first nine months of 2015, compared to 61 sales in the same period a year earlier. For a longer discussion of trends in this market, please see our multi-family section in this Fall 2015 Market Report.

Land sales increased by 8.8%, for a total of 37 transactions through September 2015. The number of new land listings declined 28% over the same period last year, to 124. With a modest increase in sales and a decline in new land listings, the market is beginning to absorb the inventory. Median price was $132,000, just over a 3% decline from a year prior.

Vacancy rate is easing in Chittenden County rental market

MARKET INSIGHTS
The county’s vacancy rate is 2.8%, significantly below the national average.
Rents have increased 3.1% annually since 2001.

CBHB_2015_Spring_NewGraph_RentalV2


Apartment hunting in Northwest Vermont is often a competitive endeavor, given an extremely low vacancy rate and increasing demand from a diverse professional workforce. Because our rental expert has extensive contacts with landlords, Realtors and associations, Coldwell Banker Hickok & Boardman Realty is well positioned to help clients find the most recent properties on the market.

The Vacancy Rate Is Easing

The vacancy rate stood at 2.8% in June, compared with a two-decade average of 1.4%, according to real estate consulting fi rm Allen & Brooks. The region’s vacancy rate has eased this year due to a boost of new apartment construction, such as Finney Crossing in Williston and Riverrun Luxury Apartments in Winooski.

The Vacancy Rate’s Impact on Renters

The higher vacancy rate is allowing renters to take more time when assessing and deciding on which property to lease, although all available units are still fi nding tenants, Allen & Brooks noted. The county’s vacancy rate, while not as low as in the past, is still well below the national average of 4.1%.

Local Hiring

Local employers such as the UVM Medical Center are hiring, with many of the professionals opting to rent before buying. As the economy continues to improve, Coldwell Banker Hickok & Boardman Realty believes more renters will decide to buy homes, which could lead to an even higher vacancy rate.

Competitive Rents

In the meantime, rents continue to be competitive in Chittenden County. The average monthly rent has increased 3.1% annually since 2002, Allen & Brooks found. Wages for some workers haven’t matched that pace, which has caused affordability issues. Residents in Burlington are spending about 44% of income on housing, a level that’s considered unaffordable, according to a report published by the city last year.

Shifting Demand Among Neighborhoods

Some less expensive neighborhoods, such as Burlington’s Old North End, are witnessing an increase in demand because they are more affordable than the Hill Section and other Burlington neighborhoods, Allen & Brooks notes. Some renters are looking for apartments in newly constructed buildings, such as South Village in South Burlington and the Packard Lofts in the Old North End, because of the convenience of living in a newly-built home with amenities.


Because our rental expert has extensive contacts with landlords, Realtors and associations, Coldwell Banker Hickok & Boardman Realty is well positioned to help clients find the most recent properties on the market.

Contact Our Rental Specialist

AubertSteStephanie Aubert
(802) 503-1150
rentals@hickokandboardman.com