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

Ivan Kaufman’s Real Estate Blog

Weekly Roundup Intro: Week of February 25, 2019

This week’s multifamily roundup takes a look at construction starts, the direction of cap rates and interest rates, and the markets attracting high-income renters. First, MultifamilyBiz reports that new construction activity picked up in January following the construction declines seen toward the end of 2018. Next, Nareit offers its outlook on the commercial real estate market by examining how cap rates and interest rates have moved over the last year. Arbor’s Chatter blog analyzes the Las Vegas apartment market, which saw the highest year-over-year rent growth in the U.S. last year, largely due to strong population growth and labor pool. Then, HousingWire breaks down HUD’s recently announced expansion of the FHA low-income housing tax credit financing program for multifamily assets. Finally, Apartment List reveals the top 10 cities for high-income renters, a rapidly growing segment of the rental population.

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Multifamily Housing Construction Starts Bounce Back Following Decline

MultifamilyBiz – February 27

“Multifamily housing bounced back 14% following its 15% December decline, and was up 1% compared to its average monthly pace during 2018.”

What’s Ahead for Cap Rates and Interest Rates?

Nareit – February 26

“Cap rates for most major property types continued to trend downward through 2018, and ended the year near or even below their lows a decade ago.”

Las Vegas Posts Highest Multifamily Rent Growth in U.S. in 2018

Arbor Chatter – February 26

“The Las Vegas multifamily market led the nation with the highest rent growth during 2018, driven by strong migration trends and a high concentration of prime-age workers.”

FHA Significantly Expands LIHTC Financing Program for Multifamily Properties

HousingWire – February 22

“According to HUD, the FHA’s expanded pilot program will ‘ensure faster and more efficient processing for low-risk, LIHTC transactions by eliminating redundant reviews.’”

Where Do Most High-Income Renters Live? Check Out the Top 10 Cities

Apartment List – February 22

“The number of households who earn six figures and choose to rent has grown 48% over the past decade, and now represents the fastest-growing segment of the housing population.”

 

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.”