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NMHC Survey Sees Apartment Market at “Virtual Standstill”
Apartment market conditions weakened in the National Multifamily Housing Council (NMHC) Quarterly Survey of Apartment Market Conditions for October. The Market Tightness (20), Sales Volume (6), Equity Financing (13) and Debt Financing (5) indices all fell short of the break-even level (50). The market softening stems partly from the Federal Reserve’s anti-inflation actions.
“The Fed’s continued interest rate hikes have resulted in higher costs of both debt and equity and a higher degree of economic uncertainty,” said NMHC chief economist Mark Obrinsky. “This has caused the market for apartment transactions to come to a virtual standstill, as buyers seek a higher rate of return that sellers are unwilling to accommodate via lower prices.”
He added, “The physical apartment market is also starting to normalize after six consecutive quarters of tightening conditions, with a majority of survey respondents reporting higher vacancy and lower rent growth” compared to the previous quarter.
- ◦Sale/Acquisition
- ◦Financing
