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moved to 82.1 percent and rent rested at $1,405 per month at the end of April 2017. In August of 2017, Harvey launched occupancy and rent to new levels. By November, occupancy reached 90.3 percent and rent was registered at $1,485. Over the course of 2018, occupancy and rent continued to advance to 91.7 percent and rent climbed to $1,494. Class B Without New Construction Class B represents the second-tier of highestpriced properties. The bell curve distribution of market rate creates a Class B that represents 37 percent of the entire market supply. Class B’s occupancy topped out at 94.2 percent back in June of 2015. As is customary with a peak in occupancy, rent also followed with a high point of $972 per month. As the fracking boom turned to bust, fundamentals began to deteriorate and occupancy dropped to 91.1 percent and rent sank to $946 per month by January 2017. Just prior to Harvey in July, occupancy advanced to 91.7 percent and rent moved forward as well to $958 per month. Harvey imposed 6,212 damaged units on Class B, and also created about 1,390 units of leasing resulting in a net drop in absorption of -
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4,822 units. These actions brought occupancy down to 89.8 percent by the end of September. Harvey-related leasing continued during the 4th quarter as victims moved from the accommodations of family and friends. Fourth quarter absorption of +3,076 units carried occupancy up to 91.1 percent. The overall average monthly rent for Class B ended 2017 at $986, which made the rent gain $40 for the year. Prior to Harvey, rent advanced by $12 and then an additional bump of $28 occurred after Harvey. During 2018, rent has continued to grow to $1,004 but occupancy has slipped to 90.9 percent. Class C and Class D Class C represents 31 percent of the overall market supply. Occupancy-wise, Class C peaked at 93.7 percent back in June of 2015 when rent was $745 per month. Since then, a steady, persistent decline has plagued Class C up until February of 2017 when occupancy bottomed out at 91.4 percent. By July, occupancy moved forward to 91.6 percent. Harvey forced 6,182 damaged units on Class C and created 2,349 units of leasing, which created a net drop in absorption of -3,833 units. By the end of September, occupancy
dropped to 89.8 percent. Fourth quarter absorption of 2,134 units moved occupancy to 90.8 percent by year-end of 2017. Rent kicked off 2017 at $770, and by July rent advanced by $3 to $773. After Harvey, rent could only advance another $9 to end the year at $782. During 2018, occupancy bounced around, but it ended September where it started in January at 90.7 percent. Despite the flat occupancy performance, rent was able to advance by $10 to $795 per month. Class D experienced a similar occupancy scenario to Class C where occupancy peaked in June of 2015 at 91.4 percent. Occupancy, after sliding for the remainder of 2015 and all of 2016, began 2017 at 88.5 percent. Hurricane Harvey had no impact on Class D with occupancy ending the year lower at 87.3 percent. Rent was only able to add $6 in 2017 going from $637 to $643. During the first nine months of 2018, the rent average in Class D was extremely flat, moving only one dollar to $644 per month and occupancy moved ever so slightly to 88.4 percent. Finishing 2018 This article was written at of the end of the 3rd quarter. How 2018 will finish is of great interest
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