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The market's annual rent growth rate was below the national average of 2.4%. The market's occupancy rate decreased from 94.5% in 1Q23 to 94.1% in 2Q23. Since 4Q01, the market's annual effective rent growth has averaged 3.1%. The market's occupancy rate has averaged 93.1% since 4Q01.

Market Performance

Effective rent increased 1.1% from $1,144 in 1Q23 to $1,158 in 2Q23, which resulted in an annual growth rate of 0.1%. Annual effective rent growth has averaged 3.1% since 4Q01. The market's annual rent growth rate was below the national average of 2.4%. Out of the 268 markets ranked by nationally, Clarksville, TN was 145th for quarterly effective rent growth, and 235th for annual effective rent growth for 2Q23. The market's occupancy rate decreased from 94.5% in 1Q23 to 94.1% in 2Q23, and was down from 97.7% a year ago. The market's occupancy rate was below the national average of 94.7% in 2Q23. The market's occupancy rate has averaged 93.1% since 4Q01.

Some apartment owners may think that turning a profit at their community is easy. These owners may believe that as long as they stay on top of work orders, collect the rent and maintain a quiet place to live, the money will come rolling in, right? Well, not quite. Although all of these daily activities are crucial, more is needed to truly compete within the marketplace. There are four common mistakes apartment owners make that can quickly cause them to lose their competitive edge and hurt their returns. We'll go over each mistake below, and how to make corrections before it's too late.

1. Not hiring the right people

Most apartment owners claim they have the best people working for them, but what is the best way to recruit, train and retain employees? When should an owner do the hiring and when should they outsource? Hiring a Certified Apartment Manager may be the answer. A Certified Apartment Manager (CAM) is an experienced property manager licensed with the National Apartment Association. As is the case with an experienced Realtor assisting buyers and sellers, these professionals live and breathe property management. They are proficient in understanding a community's industry essentials, marketing, risk management, legal responsibilities, human resource, resident relations, property maintenance and financial management.

Released at the end of last year, Bohemian Rhapsody, the story of Freddie Mercury and the band Queen, is already the highest grossing music biopic movie in history. And while Mercury was an amazing singer, it's his strong business acumen that I most often remember. The man's mind focused on solving problems, capitalizing on opportunities, and standing out from the pack - a mindset that would have no doubt served him well if he'd ever gone into the multifamily industry!

Mercury was an expert when it came to developing Queen's unique brand and identity. Born Farrokh Bulsara, he renamed himself Freddy Mercury, and later designed the band's iconic eye-catching logo, all to draw interest for the fledgling group when it was young. He also encouraged the band to explore several diverse musical styles in their early albums - such as the eight-minute canon-included "The Prophet's Song", or the operatic masterpiece "Bohemian Rhapsody" - to help gain musical acceptance in a time when rock music was just becoming widely appreciated.

Another area the band excelled in was scaling. While the group had some early problems getting a record company to sign them, they quickly scaled their group with local concerts and new albums. They continued this rapid scaling by performing at larger and larger venues, capped by the Live Aid performance at Wembley.

Queen also knew how to build a unique brand that gave them notoriety. At a time where rock had just become regularly accepted, the band pushed the envelope, adding several diverse musical styles into an album, as well as experimenting with stereo sounds.

Take, for instance, the A Night at the Opera album. The album featured a track that had an eight-minute run time, complete with a canon in the middle. Another track on the album had a harp and vocals dubbed over each other. Of course, "Bohemian Rhapsody" was also on this album, complete with its operatic tones and additional vocal overlays.

The band also developed strategic partnerships with other major artists along the way, including Monserrat Caballe, David Bowie, and even Michael Jackson, and performed with these musical masters to further Queen's notoriety and fan base.

Mercury found success by taking a practical business approach to Queen; he differentiated the band in the marketplace, taking advantage of the opportunities he was presented, and he leveraged his network to elevate everyone involved. This stand-out approach has proven paramount for many business leaders in the past, and is exactly the mindset that can help your multifamily management organization shine.

Great businesses promote the differences that exist in people or opportunities and take advantage of them. Famed keynote speaker David Rendel notes that these differences are often the key to providing sources of potential, advantage, effectiveness and joy. Even Sally Shaywitz, a neuroscientist studying dyslexia at Yale, notes that those who turn their talents into disadvantages "are overrepresented in the top ranks of [business] people, who are unusually insightful, who bring a new perspective, who think out of the box."

Look at Richard Branson. Born dyslexic, he was branded lazy and unintelligent in school. Being an individual that always turns challenges into strengths, he adapted his management style in a manner that would work with his dyslexia, rather than against it, and it's proven successful for him ever since.

Challenges can present themselves in a variety of outlets, like Branson's dyslexia or Queen's uphill battle. To identify where your biggest challenges may be, and how to overcome them as a leader in your business, consider these questions:

1. Do details make you distraught? If you're challenged by details, you likely don't have a preference for 'structural' thinking. Focus on laying out your business's plan five steps further than you think you need. At each step, always ask yourself "at this stage in the game, what is every contingency that someone would need to know?"

2. Do you usually consider the consequences? If you don't always think about the ramifications your decisions have on others, you may not have a natural inclination for 'social' thinking. To combat this, focus on gaining consensus for an idea from your employees, customers, or shareholders before pushing it through. Along the way, be sure to ask each audience "how will this impact you?"

3. Are you more focused on the minute? If you conquer the day-to-day, but don't naturally think about the big picture, you probably are not a 'conceptual' thinker. To get your mind into macro-mode, have regular brainstorms, focusing on how one idea connects to another. As you do it, think about what the ramifications of each idea at one, two and five years down the road.

4. Are you the silent, contemplative type? If you're naturally quiet, you'll need to set time aside to express yourself to your team. Conveying your thoughts and emotions to others is a critical aspect of moving your business forward. As you conduct these expressive moments, always ensure you don't talk over those you lead.

5. Do you generally prefer consistency? If you like things focused and straightforward, you need to adopt a mindset that's accepting of the opposite. Change is constantly happening, and being prepared for it is key in our industry. Being open toward switching plans is how you'll combat that. As you work to readily welcome change, be sure to offer your constituents real, valuable rationale as to why something should shift.

We all have unique qualities that come naturally; things we do well that make us exceptional. Great leadership is about recognizing the things we don't always do quite as well, and working to capitalize and improve on those things. When looking to set your goals for 2019, remember to stretch those goals further than you know you can reach, and always continue to strive to achieve them.

Don't let your perceived weaknesses hold you back. Start looking at them as strengths, and take advantage of them to help your business grow in the New Year!

We are the champions, my friends.

Emily Nations found her slice of the good life in April. After her Nashville-area apartment flooded for a third time earlier this spring, she started to look around for a new place to live. She briefly thought about buying a home a few years ago, but that wasn't even a consideration this time around - the costs of a down payment and mortgage were too steep. Instead, she ditched her old lease and signed on at a brand-new apartment complex just north of downtown.

"The market is insane right now," Nations, a 31-year-old who works in hospitality, told me. "It makes no sense to even try and buy."

It may not be an entire home, but there's plenty to love about her one-bedroom unit - the vaulted ceilings, the "huge" walk-in closet, the natural light that spills through her windows. Outside her four walls, the chic collection of modern farmhouse buildings known as Livano Trinity offers a ton of perks: a sprawling gym, a pool with a cabana for weekend hangs, private office spaces, and even doggy day care. An on-site coffee shop serves up free daily brews to first-year tenants, while a New York-style bodega satisfies her late-night cravings.

The final kicker for Nations was the discount she got for signing: two months free. While she'll pay $1,500 in rent most months, she paid only a $95 community fee plus utilities in May and June. In the meantime, she's stashing away funds in case she decides to purchase a home down the line.

Buying a home has never been a cakewalk, but the hurdles to ownership seem more daunting than ever these days: The typical mortgage rate is hovering near a two-decade high, and there are still roughly 30% fewer homes on the market than in 2019. The median sale price reached a record $390,613 in May, according to Redfin. By contrast, a wave of apartment construction has flooded once hot markets with new studios and two-bedrooms, forcing property managers to extend olive branches if they want to lure tenants through their freshly installed doors. Step inside a newish building in places like Nashville, Salt Lake City, or Atlanta, and you'll find leasing agents hawking discounts: Eight weeks free! No fees! Comped parking! That's to say nothing of amenities such as boxing gyms, rooftop pools, and plush lounge rooms. Renters finally have some leverage - especially if they can afford the latest and greatest units.

These apartments aren't cheap, sure, but they can feel like bargains compared with the costs of buying and maintaining a home right now. Household incomes have grown faster than rents over the past year, and tenants making more than the median income now benefit from more options thanks to the influx of new apartment units. Given the divergence, more and more Americans with a taste for the finer things in life and a little cash to spare are opting to ren

Homeownership is synonymous with wealth in America - rich people live in the land of mortgage payments, not rent checks. This setup has an easy logic to it: Homeowners enjoy equity gains and a sense of stability that rentals simply can't provide. But given the costs of breaking into the for-sale market, combined with the recent deals offered on many apartments, that assumption may be flipped on its head.

Landlords have always dangled concessions like rent discounts or perks in front of tenants, but the recent building boom is now paying dividends for renters looking to land a deal. Early in the pandemic, cheap borrowing rates and soaring rents encouraged developers to put shovels in the ground - more than 1.6 million new apartment units hit the market between 2020 and 2023, Yardi Matrix, a data and research firm for commercial real estate, found. The company expects another million or so units to be completed in 2024 and 2025, which would equal levels not seen since the 1970s. Much of this construction is concentrated in the kinds of sunny, cheap places that everyone dreamed of moving to during the pandemic: Houston, Atlanta, Austin, Phoenix, and Charlotte, North Carolina, among others. This boom in supply means that people in these markets may not be so desperate to land just any open unit, forcing landlords to cut deals. The typical asking rent nationwide is up only 0.7% from last year, according to Yardi Matrix, and markets such as Austin; Raleigh, North Carolina; and Tampa, Florida, have seen rents drop over the past three months. About one-third of rentals listed on Zillow are offering concessions, compared with about 10% in 2019.

"This is a much more commonplace tactic that landlords and property managers are using to get people through the door," Nicole Bachaud, a senior economist at Zillow, told me. "They're like, 'Hey, ignore that high rent price. Look, you can have this nice free thing up front.'"

Developers these days tend to focus on building new class A units, an informal classification that encompasses the newest, nicest buildings with the best amenities, which typically rent for about 30% more than class B and C units. The result is that class A units account for more than half the apartment market, compared with one-third in the early 2000s, according to Moody's Analytics. At the same time, the number of high-income renters - those earning more than $150,000 - jumped by 82% between 2015 and 2020, a RentCafe analysis of Census Bureau data found. Rich renters simply have more choices than moderate- and low-income earners.

Joel Sanders, the founder and CEO of Apartment Insiders, a Nashville firm that helps renters like Nations find new digs free of charge, told me the city's apartment market was seeing its largest supply increase ever, which has nudged landlords to pursue a "heads in beds" strategy that favors filling units rather than jacking up rents. That bodes well for his clients.

"We have people that have the incomes, make multiple six figures, but they still value getting these deals," Sanders told me.

High-end apartments that offer amenities up the wazoo - and rent breaks, to boot - represent a tantalizing alternative to the for-sale market right now. Recent shifts in the housing market mean that the holy grail of homeownership is looking more and more like a poisoned chalice. While the number of homes for sale is rising, many sellers are loath to budge on prices after watching all their neighbors cash in during the market's peak. And the combination of spiking mortgage rates, eye-watering home prices, and increased postpurchase costs for things like maintenance and insurance has tipped the buy-versus-rent debate firmly in favor of cutting rent checks.

"The cost of renting far beats the cost of owning," Doug Ressler, the manager of business intelligence at Yardi Matrix, told me. "If I'm a guy that really wants to try and pinch my pennies and not really be tied down to a home, per se, that's what I'm going to look at."

And renters can put those cost savings to work. Sure, they may be missing out on the value of building equity in a home, but David Brasington, an economist at the University of Cincinnati, previously told Business Insider that average returns in the stock market over the past 50 years had well-outpaced home-equity gains (though he also noted that the stock market is more volatile and doesn't provide you with a place to lay your head at night). Renters may choose to sock away money for a better time to buy or invest the funds they'd otherwise be spending on stuff like a new roof or interest on a home loan.

The sheer number of new units hitting lease-up right now is enough to encourage apartment operators to continue offering perks to draw in new tenants and prevent the existing ones from jumping to the next best thing. But as with all good things, the golden age for America's wealthy renters must also come to an end. While the number of multifamily units expected to be completed next year is a still robust 459,000, according to Yardi Matrix, the end of this construction wave is in sight. Developers are feeling the pinch of higher interest rates and are wary of flooding markets with more supply. As a result, they were on pace to start construction on 245,000 units this year as of March, according to the Census Bureau, down from highs of more than 600,000 in 2022. This means that you can expect the sweetheart deals for renters to trail off near the end of 2025 and into 2026, Ressler told me.

"The supply cliff is going to come real soon," Ressler told me. "In other words, starts are already slowing down."

The upside for renters, though, is that the cliff hasn't arrived yet. Those in the market can expect more options and better bargains than what was on offer just a year ago, particularly if they're eyeing a top-end unit in a city with a lot of construction cranes on the horizon. So, for now, the formula for wealthier lessees is straightforward: Ride out the good times, sock away the extra cash that isn't going toward plumbing fixes or gym memberships, and check back in on the homebuying landscape when the rental market heats up again.

Nations told me she still hoped to buy a home one day. But the timeline of her parents' generation - get married, buy a house, have kids - no longer matches the reality for her or many of her peers, she said. Luckily, though, she had another option.

"I know how challenging it is to rent in Nashville, especially on your own," Nations told me. "If you don't have a roommate or a partner, it can feel overwhelming and impossible. This was literally an answered prayer."

An apartment complex in Indianapolis, Indiana, went viral earlier this year when a real estate and investment firm shared a post on X that called it "one of the most unique residential conversions."

That apartment complex is Stadium Lofts, a former baseball stadium that was converted into 138 apartments by Core Redevelopment, a Midwest developer group. The property is owned by Michael Cox, John Watson and his two sons.

"Initially, people thought that we were crazy for wanting to turn an abandoned baseball stadium into apartments," Cox, the principal at Core Redevelopment, tells CNBC Make It.

Bush Stadium was home to the Indianapolis Indians from 1931 to 1996. After that, it was used as a dirt track for several years and eventually as a car storage site before it was abandoned.

In 2011, Watson was the board chair of Indiana Landmarks, a historic preservation nonprofit organization in the state, when they were asked to come up with ideas for saving Bush Stadium.

Watson says the stadium had been abandoned for several years and was in danger of being torn down entirely. Some of the ideas that he and the Indiana Landmarks organization had for the stadium included turning it into apartments or renovating it and using it for soccer and baseball again, but the latter plan didn't go anywhere due to a lack of funding.

"About nine months later, [the city] approached me again and said, 'If you don't do that idea you came up with to turn it into apartments, it's going to be lost. They're going to tear it down.' So, we put together a team and explored whether or not it was possible to do it," Watson says.

In 2011, Cox, Watson, and his two sons took ownership of the stadium, according to documents reviewed by CNBC Make It. The city of Indianapolis transferred the property's deed to the Indiana Landmarks for $10 and the historic preservation nonprofit organization handed it over to the partners for $1.

"Often cities dispose of properties to nonprofits for disposition," Watson says. "That is what happened here."

As part of the deal with the city of Indianapolis to get the stadium, Core Redevelopment was mandated to build an additional 144 apartments outside of the stadium in four adjacent buildings, which they named Stadium Flats.

The Stadium Flats addition was completed about a year after the Stadium Lofts opened and cost around $13 million. By the time Stadium Flats opened in July 2014, all of the apartments were leased. It consists of 90 one-bedroom apartments, 48 one-bedroom apartments, and 6 one-bedroom apartments with dens. The rents range from $1,067 to $1,470.

Cox, Watson, and his sons had a budget of $14 million for the Stadium Lofts conversion and, in the end, spent roughly $13.8 million. The amount includes $1 million from Cox, Watson and each of his sons, a $6.5 million mortgage, $5.3 million in grants from the city of Indianapolis, and the $1 acquisition cost.

The mortgage has since been paid off and replaced with long-term permanent financing, Watson says.

The stadium's renovation began in August 2011 and was completed in a little under two years. By the time it opened in July 2013, all 138 apartments had been leased.

It was converted into 95 one-bedroom apartments, 26 two-bedroom apartments, and 17 lofts. Rent in the complex ranges from $900 to $1,700 and each apartment has a washer and dryer.

"Our biggest concern when we started this project was, 'Who is going to show up and rent it?' There wasn't much housing in the neighborhood. There wasn't much economic activity in the neighborhood," Watson says. "We were kind of pioneers when we did this project, so we were concerned about its success, and we underwrote it conservatively."

The stadium is located in Indianapolis, Indiana. As of April 2024, the median rent for all bedroom counts and property types in Indianapolis, IN is $1,360. This is 32% lower than the national average, according to Zumper.

Cox admits turning the stadium into a residential space was a tough project for the group from a technical standpoint. When they took ownership, they needed to solve the many issues the property already had while still maintaining its character.

Some of the original stadium features Watson and Cox kept include the scoreboard, the old ticket booths and the press box, and they even put the base pads back in the existing field to pay homage to what was there before.

"We designed it such that when you walked in, you felt like you were walking into a historic stadium rather than an apartment building," Watson says.

The developers also installed balconies made of chain link fencing "to create that stadium-type appeal," Watson says.

"One of the unconventional things we did was we exposed all the concrete floors in the units," he added.

The building's fitness center has photos of the old stadium hanging throughout. The complex also offers residents several study rooms. The developers built a courtyard for residents to hang out next to the field that includes a gas fireplace and tables and chairs.

Cox says seeing the completed transformation of the once-abandoned stadium was "the culmination of a childhood dream" in a way.

"I played baseball growing up and I always thought maybe I'd get into the Hall of Fame as a baseball player," he says.

Watson adds it was also amazing to see the amount of interest from the people of Indianapolis when Stadium Lofts opened.

"Almost everybody had been here for a baseball game sometime during their lifetime, so the connections were deep, and people couldn't wait to come to the project," Watson says.

At the Golden Legacy Awards Gala we had tremendous honor to be recognized as the Management Company of the Year from the Property Management Association of Clarksville. We are sincerely humbled by this accolade, which we believe would not have been achievable without the dedication and contributions of every member of our team.

Their dedication, passion, and relentless pursuit of excellence have driven us to achieve this remarkable milestone. Each challenge we faced was met with creativity and resilience, showcasing the true spirit of collaboration that defines our company.

As we celebrate this achievement, we remain committed to fostering an environment where innovation thrives, COMMUNITY matters, and every team member feels valued and empowered. This award motivates us to continue pushing boundaries and setting new standards in our industry.

We extend our heartfelt gratitude to our clients and community for their trust and support. Together, we strive to create meaningful impact and lasting success. Here's to many more years of growth and accomplishments!

Keeping you current on fair housing news and issues

Angelita Fisher is an attorney in the Nashville,TN area. She has over 20 years experience in representing companies in fair housing law and employment law matters. Angelita is licensed to practice law in Alabama, Texas, Mississippi and Tennessee.

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