Category: Multifamily

Multifamily Investors Are Spending More Capital in Secondary, Tertiary Markets

Slightly higher yields and still expanding economies are driving multifamily investors to smaller cities.

Multifamily investors are now more likely to spend their money on properties in secondary and tertiary markets rather than in primary markets.

“In secondary and tertiary markets… the number of offers that we are generating is much higher than what it was,” says John Sebree, Midwest-based first vice president and national director of the national multi housing group with brokerage firm Marcus & Millichap. “The level of sophistication of those buyers is much higher.”

After the more than a decade of expansion, investors are running out of attractive places to invest their capital. In secondary and tertiary markets, the yields are often only slightly higher than in primary markets; however, the local economies are strong enough to keep attracting more investors.

Click Here For The Full Article

SUBSCRIBE TO OUR NEWSLETTER

Start receiving; press releases, commercial real estate news, information and trends on particular markets and regions.


Picture: Pixabay

Five 2020 Trends to Consider in Multifamily Investment

With the new decade quickly approaching, Fogelman’s Mike Aiken breaks down why multifamily is a reliable bet.

Cautious optimism is the proverbial tone many multifamily investors are taking as the start of a new decade is only a few weeks away. The whispers of a slowing economy have turned to a dull roar, but according to recent IMF reports, the U.S. economy is expected to steadily grow 2.1% over the next year. As economic pessimism lifts the outlook looks rosier for multifamily investment with continuing job growth. Without indication of a significant downturn, steady pace and predictability will be key performance indicators for multifamily investment as the balance of supply and demand level off and favorable financing conditions continue with the government-sponsored enterprises. Here are five trends to watch with the start of a new decade.

1. Most Compelling Commercial Asset

Considered an oasis of lower volatility investing and a safe haven for market unpredictability, multifamily remains the most reliable bet for commercial investors.

Click Here For The Full Article

SUBSCRIBE TO OUR NEWSLETTER

Start receiving; press releases, commercial real estate news, information and trends on particular markets and regions.


Picture: Pixabay

Small multifamily loans: providing sustainable and affordable financing solution

How the GSEs are changing the multifamily market

The lack of affordable housing has reached crisis level in the nation’s cities and suburbs.

The squeeze has tightened across housing segments steadily for years. Between 2005 and 2017, the stock of single-family homes remained essentially flat, resulting in unattainable homeownership for many. Though expected wage increases and moderating home prices should offset some of this higher homeownership cost, the U.S. credit card debt being at an all-time high and the student debt load topping $1.5 trillion means that the down payment needed to purchase a home is simply not possible for many Americans.

With renter demand continuing unabated and many Americans being priced out of owning a home, the single-family market is feeling the pressure of higher interest rates, a lack of affordable single-family supply, and historically high debt loads. According to Harvard researchers, from 2001 to 2016 renters’ median housing costs rose by 11% while their income actually fell by 2%. Even though rental units grew 23% during that span, the rental market has also remained constrained and seen prices soar.

Click Here For The Full Article

SUBSCRIBE TO OUR NEWSLETTER

Start receiving; press releases, commercial real estate news, information and trends on particular markets and regions.


Picture: Pixabay

Five Tips for Securing Multifamily Financing and Articulating Your Case to Capital Providers

This about what is your borrower story when trying to secure financing.

With a possible recession looming, investors seeking to de-risk their portfolios are looking at an increasingly limited menu of stable investment options. Yet one of those options is clearly evident: multifamily remains a popular option for investors and capital providers alike. That’s largely because home affordability issues and changing lifestyle preferences are driving more renters to stay in apartments longer, strengthening demand and, in turn, pushing up rents. In fact, rents in the third quarter of 2019 were up 2.9 percent over the previous year, according to RealPage Inc., a real estate analytics firm.

Foreign investors alone acquired $16.1 billion of apartment properties in the U.S. between the second quarter of 2018 and the same period this year, according to research firm Real Capital Analytics. This occurred even as those investors pulled back on other asset classes.

Investors who are trying to increase their presence in the multifamily market don’t have to look far to find lenders to finance an acquisition. There’s plenty of capital to go around. The Mortgage Bankers Association (MBA) projects multifamily lending will grow to $359 billion in 2019, up from last year’s record total of $339 billion.

Click Here For The Full Article

SUBSCRIBE TO OUR NEWSLETTER

Start receiving; press releases, commercial real estate news, information and trends on particular markets and regions.


Picture: Pixabay

Some Millennials say they plan on renting forever

Financial struggles are holding this generation back more than ever

Although Millennials seem to be taking over the housing market, nationally, 12.3% of Millennial renters say they plan to keep renting.

Last year, 10.7% said they plan to always rent, up over 2%, a study from Apartment List said.

For most, being able to make a down payment is the biggest struggle when it comes to purchasing a home.

In fact, nearly half of Millennial renters have no down payment savings, according to the study.

Another major barrier for this generation? Student debt. Even those who are debt-free are only saving about $100 more a month than those who have the burden of paying off loans.

Almost half of Millennials with no college degree have $3,221 saved for a down payment, while 50% with a college degree and debt have $8,200 saved for a down payment.

Click Here For The Full Article

SUBSCRIBE TO OUR NEWSLETTER

Start receiving; press releases, commercial real estate news, information and trends on particular markets and regions.


Picture: Pixabay

Flush with Cash from Target, Startup Attacks Rental Headaches

Landing is a new membership-based firm that provides short-term furnished rentals in some of the country’s most expensive cities.

(Bloomberg)—When Bill Smith moved to San Francisco in 2016 to work on his grocery-delivery startup, the most annoying part was finding an apartment.

Poring through rental listings in an unfamiliar city, calling the gas company, waiting for an internet connection — the entrepreneur had little patience for any of it. So, after Smith sold his company, Shipt, to Target Inc. in 2017 for $550 million, he decided to use some of that cash to do something about it.

In June, using $15 million of his own money, he started Landing, a membership-based firm that provides short-term furnished rentals in some of the country’s most expensive cities. He’s leasing blocs of apartments from landlords including Related Cos. and AvalonBay Communities Inc., filling the units with furniture and dishware, hooking up cable and internet and renting them out at a markup for as little as 30 days.

Click Here For The Full Article

SUBSCRIBE TO OUR NEWSLETTER

Start receiving; press releases, commercial real estate news, information and trends on particular markets and regions.


Picture: Pixabay

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

Apartment rents are rising, but far below previous years’ levels.

Apartment rents are likely to keep rising, even if the economy continues to slow over the next year, according to industry experts.

“The occupancy outlook probably will allow rents to continue to grow, although at a pace a little under the increases recorded of late,” says Greg Willett, chief economist with RealPage Inc., a provider of property management software and services.

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. An economic slowdown would cut into those occupancy rates, but not enough to dramatically impact rents. The exception would be new, luxury apartment projects, which might struggle to lease-up. The markets where new luxury development is concentrated may also struggle.

Click Here For The Full Article

SUBSCRIBE TO OUR NEWSLETTER

Start receiving; press releases, commercial real estate news, information and trends on particular markets and regions.


Picture: Pixabay

Breaking Down CBRE’s 2020 Market Outlook

CBRE provided NREI with an exclusive sneak peek at its 2020 Real Estate Market Outlook report.

CBRE sees more growth ahead for the U.S. commercial real estate industry in 2020, although the pace of expansion could slow thanks to already strong fundamentals that will be tough to improve upon combined with some broader economic headwinds as part of its 2020 Real Estate Market Outlook. Specifically, uncertainty surrounding trade negotiations, weakness in manufacturing and the approach of the presidential election season will hang over the industry in 2020.

Still, the report predicts a “very good year” for the industry.

CBRE provided NREI an exclusive first look at the outlook report. Investment sales volumes should remain near peak levels and industry fundamentals in most sectors will remain strong as well, according to the forecast.

Click Here For The Full Article

SUBSCRIBE TO OUR NEWSLETTER

Start receiving; press releases, commercial real estate news, information and trends on particular markets and regions.


Picture: Pixabay

Multifamily rents gain 3.2%

Occupancy has also been doing well

Multifamily rent growth remained positive in October, a new report from YardiMatrix said.

Multifamily rent increased by just $1, to $1,476. Year over year rent growth remained at 3.2%.

Of the 30 major markets covered in the report, 17 saw year-over-year rent growth of at least 3.3%. San Jose and Houston remained below the 2.5% long-term average.

Although the multifamily market boasts positive results, three states had bills passed to limit rent growth.

Rent control affects the multifamily sector because it puts a chill on development during a period of low housing stock, YardiMatrix said.

Although rent has topped historical growth levels, occupancy rates still remain strong.

Click Here For The Full Article

SUBSCRIBE TO OUR NEWSLETTER

Start receiving; press releases, commercial real estate news, information and trends on particular markets and regions.


Picture: RentCafe

Commercial and multifamily originations surge in Q3

Strong market expected to continue into 2020

Commercial and multifamily originations surged in the third quarter, the latest Quarterly Survey of Commercial/Multifamily Mortgage Bankers Originations from the Mortgage Bankers Association stated.

Commercial and multifamily originations rose 24% from the third quarter of 2018 and 9% from the second quarter in the third quarter this year, the survey states.

“Low interest rates are supporting strong levels of commercial and multifamily borrowing and lending,” said Jamie Woodwell, MBA vice president for commercial real estate research. “Through the third quarter, every major capital source is lending at a pace above last year’s level. Loans backed by multifamily and industrial properties, and made for life companies and Fannie Mae and Freddie Mac, are all running at a record pace.”

And what’s more, this pace is expected to continue even into 2020.

Click Here For The Full Article

SUBSCRIBE TO OUR NEWSLETTER

Start receiving; press releases, commercial real estate news, information and trends on particular markets and regions.


Picture: Pixabay
Scroll to top