Ivan Kaufman’s Blog 2017-07-19T16:32:21+00:00

Ivan Kaufman’s Real Estate Blog

Weekly Roundup Intro: Week of February 11, 2019

This week’s multifamily roundup takes a look at 2019 mortgage maturity volumes, small balance investment trends and interest rates’ impact on the apartment sector. First, MBA reports that loan maturities this year will rise 8% from last year’s total of $102.2 billion, which is a “relatively stable” volume. Next, MultifamilyBiz analyzes the top U.S. markets for new multifamily construction by dollar amount, finding that activity levels varied among the metros. Arbor’s Chatter blog offers its year-end 2018 report on the small balance multifamily market, noting that total lending volume was up 3.7% from the previous year. Then, Trepp observes that even if interest rates rise, the impact won’t be significant on the apartment industry, which has led all other sectors in price increases. Finally, Multifamily Executive reveals that Las Vegas, Phoenix and Atlanta had the strongest rent growth year-over-year, according to the latest monthly report from Yardi Matrix.

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2019 Commercial and Multifamily Mortgage Maturity Volumes to Increase 8 Percent

MBA – February 12

“The Mortgage Bankers Association said $110.5 billion (6 percent) of the $1.9 trillion in outstanding commercial and multifamily mortgages held by non-bank lenders and investors will mature in 2019.”

 Multifamily Construction Starts Showed Mixed Performance Across Top Metropolitan Areas in 2018

MultifamilyBiz – February 14

“Of the top ten markets, ranked by the dollar amount of construction starts, four reported greater activity in 2018 while six showed declines.”

Year-End 2018 Small Balance Multifamily Investment Trends Report

Arbor Chatter – February 7

“Despite significant pressure from rising interest rates through most of 2018, the small balance multifamily market ended the year strong, with consistent liquidity and borrowing capacity.”

Interest Rates Won’t Slow Down the Multifamily Market in 2019

Trepp – February 8

“If you look at transaction volumes and mortgage originations, multifamily continues to lead all commercial property types. At the end of the third quarter, multifamily prices were up 9% from a year earlier.”

National Rent Remains Flat, YOY Growth Rises to 3.3%

Multifamily Executive – February 12

“Las Vegas remains the strongest major market for rent growth on a YOY basis, at 7.9%, followed by Phoenix, at 6.5%, and Atlanta, at 5.9%. Each is at or approaching its cycle high for rent growth.”

Weekly Roundup Intro: Week of February 4, 2019

This week’s multifamily roundup provides insights on the outlook for the sector, renting patterns among Seniors and Millennials, and strategies to attract and retain talent. First, Yardi notes that industry participants are optimistic about the performance of the multifamily market this year, with expectations for continued rent growth and apartment demand. Next, Freddie Mac reports that older generations are choosing to age in place, resulting in a high homeownership rate for the age group, while Millennials are continuing to delay homebuying. Arbor’s Chatter blog shares unique approaches multifamily owners and property managers are taking in order to recruit new employees and maintain a productive work environment. Then, NREI argues that strong demand and positive fundamentals will help the apartment sector remain resilient, even if there is a market correction or downturn in the near future. Finally, NAHB analyzes why the share of potential homebuyers is declining, finding that a lack of affordability is a major concern for the market.

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S. Multifamily Outlook Holds Strong

Yardi – February 7

“A January survey of 127 major U.S. real estate markets showed that despite flat rent performance, which is normal for winter, year-over-year rent growth increased by 10 basis points to 3.3%, the sixth consecutive month above 3%.”

While Seniors Age in Place, Millennials Wait Longer and May Pay More for their First Homes

Freddie Mac – February 7

“We find that seniors born after 1931 are staying in their homes longer, and aging in place. The result is higher homeownership rates for this group relative to previous cohorts.”

Multifamily Firms Share Strategies for Success in the War for Talent

Arbor Chatter – February 5

“Multifamily owners and managers gathered for a panel at the NMHC Apartment Strategies Outlook Conference in San Diego to discuss the strategies they’re implementing to attract the right employees and entice them to stay with the organization for the long term.”

The U.S. Apartment Sector Would Continue to Remain Strong Even in a Recession

NREI – February 5

“Though the high end of the market may be feeling the strain of overbuilding, the sector overall is benefitting from long-term trends that should continue to fill apartment units for the foreseeable future.”

Share of Adults Planning to Buy a Home Drops From 24% to 13% in a Year

NAHB – February 4

“This sharp decline in the share of prospective home buyers provides additional evidence that the erosion of housing affordability has become a serious concern for the housing market.”

 

Weekly Roundup Intro: Week of January 28, 2019

This week’s multifamily roundup offers takeaways from the 2019 NMHC Strategies & Outlook Conference, a look at the flattening yield curve’s implications for real estate, and an analysis of the income gap between homeowners, buyers and renters. First, GlobeSt.com reports on the drivers set to fuel multifamily demand in 2019 and beyond, as well as where there are still opportunities for growth. Next, Trepp analyzes how fluctuations in short-term and longer-term interest rates are impacting real estate sales, inventory and prices. Arbor’s Chatter blog takes a look at how demographic shifts and an aging U.S. population are affecting housing market trends. Then, Zillow breaks down household income disparities between homebuyers, owners and renters, highlighting markets where the income gap is particularly wide. Finally, RealPage notes that significant improvement in several metros contributed to national rent growth accelerating in 2018—the first time there’s been momentum since 2015.

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Job Growth and Millennials Driving Multifamily Demand

GlobeSt.com – January 31

“The class C vacancy rate is the lowest across the three classes…which we haven’t seen since back in 2001. The flip side is that we are seeing the class A space getting the majority of the upward momentum in terms of vacancy.”

What Does a Flattening Yield Curve Mean for the Real Estate Markets?

Trepp – January 30

“The more stable rate environment would also be positive for commercial markets. To date, we have not seen much upward pressure on cap rates, even though longer-term Treasury yields have increased.”

Demography Set to Be the Next Disruptor for Multifamily

Arbor Chatter – February 1

“Speaking at the 2019 NMHC Apartment Strategies Outlook Conference, MIT AgeLab Director Joe Coughlin discussed how population shifts and changing generational behaviors could be the greatest disruptor for the housing market.”

Where and Why the Income Gap Among Buyers, Homeowners and Renters is Widening

Zillow – January 29

“To become a homeowner today, buyers need to earn more money than households that already own their home. The typical buyer household earns twice as much (2.1 times) as the typical renter. In some metros, the gap is as high as 2.8 times.”

Rent Growth Jumps in Several Apartment Markets in 2018

RealPage – January 28

“For the first time since 2015, U.S. apartment rent growth accelerated in 2018. The 3.3% increase for the year landed above the 2017 increase of 2.5%. Driving the national momentum was significant improvement in several individual markets, thanks in large part to middle-market performance.”