Ivan Kaufman’s Blog2017-07-19T16:32:21+00:00

Ivan Kaufman’s Real Estate Blog

Weekly Roundup Intro: Week of November 25, 2019

This week’s roundup offers insights on opportunity zones, multifamily construction trends and 2020 predictions for the housing market. First, Trepp provides an update the Opportunity Zone program, including new regulatory developments and where investors are acquiring properties to take advantage of its benefits. Next, NAHB analyzes the average unit size of new multifamily construction, with the median shrinking from a post-recession high of 1,133 square feet in 2015 to 1,108 square feet as of third-quarter 2019. Arbor’s Chatter takes a look at single-family rental cap rates, which have remained steady despite interest rate volatility throughout this year. Then, Redfin provides its predictions for the housing market in 2020, including its expectations for a competitive landscape due to fewer available homes and low mortgage rates. Finally, Realtor.com releases its affordability report for the third quarter, which found that while homes are slightly more affordable than they were last year across the top 100 metros, most markets continue to suffer from a lack of affordable housing supply. 

An Update on Opportunity Zones: How will Regulatory Uncertainty Impact Investment?

Trepp – November 26

“The frenzy has since subsided considerably, but the program nonetheless continues to pique investor interest.”

Multifamily Built-for-Rent: 93% Market Share

NAHB – November 25

“The market share of rental multifamily construction starts held steady at 93% during the third quarter of 2019. In contrast, the historical low share of 47% was set during the third quarter of 2005, during the condo building boom.”

SFR Cap Rates Hold Steady as Benchmark Interest Rates Fall

Arbor Chatter – November 25

“Dating back to 2012, SFR cap rates reached a high of 11.0%. In the years since, they have dropped by more than 470 basis points (bps) to 6.3%.”

Redfin’s 2020 Housing Market Predictions

Redfin – November 25

“We predict the housing market will be more competitive in 2020 as the cooldown that began in the second half of 2018 comes to an end.”

Home-Ownership More Affordable than a Year Ago but Remains out of Reach for Many

National Association of REALTORS – November 25

“In the third quarter of 2019, 81 out of the nation’s 100 largest metros became more affordable compared to the same time period in the previous year, whereas 10 were unchanged and 9 became less affordable.”

Weekly Roundup Intro: Week of November 18, 2019

This week’s roundup takes a look at millennial rentership, multifamily rent growth and the most expensive zip codes in the U.S. First, Apartment List reveals the results of its “2019 Millennial Homeownership Report,” which shows that 12.3% of millennial renters plan to “always rent,” an increase from 10.7% a year ago, with many respondents saying down payments present the biggest obstacle to owning a home. Next, NREI notes that apartment rents are expected to continue rising due to sustained demand, but rates of growth will be slower than in previous years. Arbor’s Chatter blog covers NYU Schack’s recent capital markets conference, where expert panelists discussed issues impacting the real estate sector, including technology adoption and finding investment opportunities in the current economic environment. Then, CoreLogic observes that single-family rents increased 3% year over year in September, with lower-priced homes seeing faster increases than high-priced homes. Finally, PropertyShark lists the most expensive cities in the U.S., with California and New York housing some of the nation’s priciest metros.

2019 Millennial Homeownership Report: More Millennials Are Preparing For A Life of Renting

Apartment List – November 19

“The share of millennials who plan to rent forever is on the rise. Even among those who expect to purchase a home in the future, nearly half have saved nothing for a down payment.”

Apartment Sector Likely to Experience Continued Rent Growth, Albeit at a Slower Pace

NREI – November 19

“Developers continue to plan to open hundreds of thousands of new apartment units every year for the next few years. Overall, however, occupancy levels remain relatively high.”

Real Estate Investors Adapt to a Changing Environment

Arbor Chatter – November 20

“Finding investment opportunities in the late stage of the cycle, the rise of the shared economy and technology’s impact on real estate were all significant topics discussed at the recent NYU Schack Institute of Real Estate’s 52nd Annual Capital Markets Conference in Manhattan.”

Low Rental Supply is Pushing Up Rents

CoreLogic – November 19

“Rents on lower-priced rental homes increased 3.8% year over year and rents for higher-priced homes, defined as properties with rents more than 125% of the regional median rent, increased 2.9% year over year.”

Top Most Expensive U.S. Zip Codes in 2019

PropertyShark – November 18

“Hitting an all-time high in 2019, California claimed a jaw-dropping 91 zip codes of the 125 zips featuring the 100 most expensive medians, including 6 of the 10 priciest.”

Weekly Roundup Intro: Week of November 11, 2019

This week’s roundup highlights cost-burdened renters, NMHC’s annual renter preferences report and multifamily construction patterns. First, Novogradac reports that the number of households headed by those age 65 and older that are cost-burdened has reached an all-time high of 10 million, with this age group lacking access to affordable housing options, according to a Harvard JCHS report. Next, NMHC releases its 2020 Apartment Resident Preferences Report, which reveals the top amenities renters want and their top concerns when searching for apartments. Arbor’s Chatter blog presents an overview how the multifamily market and U.S. economy are performing at this late stage of the current cycle. Then, RENTCafe takes a look at development activity for high-rise, mid-rise and low-rise multifamily buildings, noting that apartment buildings are getting taller and skyscrapers are making up a larger part of urban skylines. Finally, Redfin analyzes the economic impact of transit centers, finding that incomes and rents grew faster in neighborhoods offering transit access that connects to more economic and job opportunities.  

Rate of Cost-Burdened in Older Age Group Reaches New High of 10 Million Households

Novogradac – November 14

“Homeowners still make up the majority of older American households, with 74 percent of those within the 50 to 64 group owning a home, and 78 percent of those 65 and over owning a home.”

NMHC & Kingsley Associates 2020 Apartment Resident Preferences Report 

NMHC – November 12

“The report is the largest-ever collection of apartment resident insights, featuring input from nearly 373,000 renters living in 5,336 communities across the U.S.”

The State of the U.S. Economy and Multifamily Market Heading into 2020

Arbor Chatter – November 13

“As the longest expansion in U.S. history continues, real estate industry players are looking at the performance of the U.S. economy and the market’s fundamentals for clues as to the longevity of this cycle.”

High and Mid-Rise Apartment Buildings Are Overshadowing Low-Rises for the First Time in 3 Decades

RENTCafe – November 11

“With demand for apartments strong across the country, combined with the scarcity and value of land sharply increasing, developers in urban areas are looking upwards in their quest to providing a healthy supply of residential units.”

Income Gains and Rent Increases Follow Rail Transit

Redfin – November 12

“In general, the addition of transit seems to be a net positive for a neighborhood. Many of the neighborhoods that gained rail transit access were relatively diverse, and in the decades after the train stops opened there, they saw a stronger boost in incomes than other similar areas without transit, even while remaining diverse.”