Invest In Apartment Buildings In New London County, CT

Where New London County's Apartment Demand Comes From

About 32.7% of households in New London County, CT rent their home. That's 35,836 renter households, according to the Census Bureau's ACS 2017–2021 estimates. Renter households fell 0.5% over five years, close to the population trend (down 1.1%).

Median household income in New London County, CT is $79,040, up 17% over five years. Resident employment fell 2% and the unemployment rate was 5.1% in the latest survey. Rent and income have moved at a similar pace (14.7% and 17%), so affordability hasn't shifted much.

New London County leans toward ownership. Apartment buildings compete with single-family rentals for tenants, so we look closely at how a property's rents compare with nearby rental houses. Connecticut replaced its counties with planning regions in Census data from 2022, so figures for New London County use the last county-level survey (2017–2021 compared with 2012–2016).

New London County Rent Trends And Supply

Median gross rent in New London County, CT is $1,192 a month, up 14.7% from $1,039 in the 2012–2016 survey (U.S. Census ACS 2017–2021). That's slower than the national trend. In a market like this, a business plan has to work on today's rents, not on big increases.

Rental vacancy is 4.4%, within the normal range for a balanced market. 46.3% of renters spend 30% or more of their income on housing. That is close to the national picture, where roughly half of renters do, so rent increases need to track local wage growth.

About 14.4% of homes in New London County are in buildings with 5 or more units, roughly 17,620 homes. It grew 2.3% over five years, a moderate amount of new supply. The median home was built in 1968. Much of the stock is old enough that roofs, plumbing and electrical systems need a close look, and older buildings are where value-add renovation plans start.

New London County By The Numbers

Out of 4 Connecticut counties in our data, New London County comes in 3rd for median gross rent, 4th for renter share and 3rd for five-year rent growth. Its rents fall in the middle of the pack. Put in counts rather than percentages, that is roughly 2,902 fewer residents, 180 fewer renter households and 396 more homes in buildings with 5 or more units than five years earlier. With fewer renter households than before, a building has to win tenants from competitors rather than from new demand.

Cities In New London County At A Glance

We follow 2 cities in New London County. The largest is Norwich, with a median gross rent of $1,253 a month.

New London County Compared With Connecticut

New London County's median gross rent of $1,192 is below the Connecticut median of $1,488.

New London County Rent Affordability In Dollars

The median rent in New London County works out to $14,304 a year, about 18.1% of the median household income of $79,040. Under the common 30% guideline, a household needs about $47,700 a year to cover that rent comfortably. That's close to the Connecticut figure of 18.6%. Renters usually earn less than the all-household median, so the real burden for tenants is higher than this simple ratio shows.

Since the 2012–2016 survey, the median rent rose $153 a month ($1,836 a year), while median household income rose $11,484 a year. The two have moved together, so affordability today looks much like it did five years ago.

Quick Facts: New London County Rental Market

Here's the New London County rental market in short form, with the source on every figure.

• New London County, CT has 269,131 residents, down 1.1% from the 2012–2016 survey (U.S. Census ACS 2017–2021).
• Median household income in New London County, CT is $79,040, up 17% over five years (U.S. Census ACS 2017–2021).
• Median gross rent in New London County, CT is $1,192 a month, up 14.7% over five years (U.S. Census ACS 2017–2021).
• 32.7% of households in New London County, CT rent, about 35,836 renter households (U.S. Census ACS 2017–2021).
• 14.4% of homes in New London County, CT are in buildings with 5 or more units (U.S. Census ACS 2017–2021).
• The rental vacancy rate in New London County, CT is 4.4%, and 46.3% of renters spend 30% or more of income on rent (U.S. Census ACS 2017–2021).
• The median home in New London County, CT was built in 1968 (U.S. Census ACS 2017–2021).

What We Look For In New London County

We look at buildings with 5 or more units in New London County, from small walk-ups to larger garden-style communities, in stabilized or value-add condition. We compare in-place rents with nearby buildings, inspect roofs, plumbing and HVAC, and ask whether better management or targeted renovation can close the gap with the market.

Property taxes are a big line item for any Connecticut apartment building. We estimate the tax bill as it will be after the purchase, because a sale can trigger a reassessment in many places. Connecticut has no statewide rent control law, though local rules on notices, fees and deposits still apply. Insurance quotes in Connecticut reflect winter storm and frozen-pipe claims, so we get a quote before we make an offer.

We use modest rent growth assumptions, realistic repair budgets and financing that can carry the property through a slower year.

Questions To Ask About An Apartment Syndication In New London County

Whoever the sponsor is, these are the questions we would want answered about any apartment syndication in New London County, based on the local numbers above.

• What vacancy does the plan assume? Rental vacancy in New London County is 4.4%. A plan that assumes much lower vacancy than the market should explain why.
• What rent growth is underwritten? Rents here rose 14.7% over five years. Ask whether the plan assumes that pace continues, and what happens to the deal if rents stay flat.
• How was the property tax bill estimated? A sale often triggers a reassessment, so the bill after purchase can be well above what the seller pays today.
• What capital work is budgeted? The median home in New London County was built in 1968, so roofs, plumbing and electrical systems deserve their own line items.
• How will the building hold occupancy? Renter households in New London County fell 0.5%, so the plan should show how it keeps units full.
• How and when does capital come back? Ask what the plan is for a refinance or sale, and what happens if that takes longer than expected.

How Passive Investing In A New London County Apartment Syndication Works

Two groups make an apartment syndication work. The sponsor, or general partner, handles the deal: finding the building, financing it and running the business plan. The limited partners are passive investors who contribute capital and share in the property's results under the offering's terms.

Syndications are long-term and illiquid, and capital usually stays committed for several years. Results are never certain. Most offerings are limited to accredited investors, and the rules depend on whether a deal uses Rule 506(b) or Rule 506(c). See investing with Skyline Capital for how we work with limited partners.

Getting Started

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