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Trendlines Continue to Favor Apartment Sector
The trendlines continue to favor the apartment market, Walker & Dunlop says in its Fall Multifamily Outlook report. Among these are homeownership rates, absorption rates of new product and the low interest rate environment.
“Homeownership rates have been trailing downward over the past year, dropping 70 bps in 2019 to 64.1% in the second quarter of 2019,” the report states. “While there are a number of good indicators for home sales including low mortgage rates, rising incomes and good employment markets, there is a lack of affordable homes to buy.”
Meanwhile, the apartment construction pipeline is 0.8% fuller than it was a year ago, with some 797,000 units headed for delivery. Even so, says Walker & Dunlop, “demand fundamentals remain favorable. Space is being absorbed and rents continue to rise at a moderate rate.”
And while Federal Reserve chairman Jerome Powell has indicated that we may be seeing the last of further reductions to the federal funds rate for awhile, “rates are expected to remain low in the near term,” according to the Walker & Dunlop report.
Pictured: Walker & Dunlop CEO Willy Walker.
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- ◦Economy
