Regional Differences: How is the current state of residential vacancy rates in employment hubs?
The urban In contemporary urban design, mixed-use development has become increasingly popular, integrating residential, commercial, and business aspects within employment centers. These multifaceted spaces allow people to live, work, and relax in close proximity. Employment hubs with a considerable residential population and low vacancy rates are representative of this emerging trend in urban design. Analyzing regional distribution across the United States offers intriguing insights for both urban planning and real estate investment. The map provided below displays the vacancy rates in MSAs in the US.
The next data shows the vacancy rate of properties in our database. We cut out lower than 5% and higher than 95% to remove outliers. The average vacancy rate is 11%. Because these are properties in MSA, it's a bit higher than the national average.
Figure 1. Vacancy rate of properties
It appears that MSAs in the other regions have a higher average vacancy rate compared to the Eastern and Western coasts.
Figure 2. Thematic map shows the mean vacancy rate of MSAs
Job Market Dynamics: Driving Factors for Vacancy Rates?
The job market has been experiencing shifts, which may have an impact on the vacancy rates in the Metropolitan Statistical Area (MSA). In light of this possibility, we investigated to determine if there was a correlation between changes in job postings over the past three months and the MSA's vacancy rates. Ideally, examining the current workforce would have provided a more accurate assessment, but due to data limitations, we utilized job posting numbers as a proxy. Our analysis yielded an insightful finding. By employing a regression model, we discovered a significant positive correlation between the MSA vacancy rates and the number of job postings at the MSA level.
=============================================================================
Vacancy rate | coef std err t P>|t| [0.025 0.975]
-------------------------------------------------------------------------------------------------------------
| Job posting Change | 1.868e-06 5.88e-07 3.178 0.002 7.05e-07 3.03e-06
=============================================================================
Opportunity: high job posting and high vacancy rate.
Isn't it likely that areas with increased job postings but low vacancy rates will experience growth? We will continue to track and examine this in the next article of this series.