Record Mortgage Rate Growth Curbs Multifamily Investment
Freddie Mac Multifamily said its Apartment Investment Market Index (AIMI) fell by 11.7% in the second quarter of 2022, with the index down 17.9% from a year ago. AIMI decreased nationwide and in all 25 markets on both a quarterly and annual basis, driven primarily by record mortgage rate growth.
The nation and 11 markets experienced their largest annual AIMI decline in the history of the index. Over the past year, property prices have experienced significant growth, rising by 21.8%, NOI grew by 17.7% and mortgage rates increased by 1.31 percentage points, the largest increase in the history of AIMI.
“The impact of the rapid and substantial increase in both mortgage rates and property prices is evident in this quarter’s AIMI,” said Steve Guggenmos, VP of research & modeling at Freddie Mac Multifamily. “Although higher rates and property prices have driven the index down, NOI growth remains strong.”
Paul Bubny serves as Senior Content Director for Connect Commercial Real Estate, a role to which he brings 13-plus years’ experience covering the commercial real estate industry and 30-plus years in business-to-business journalism. In this capacity, he oversees daily operations while also reporting on both local/regional markets and national trends, covering individual transactions across all property types, as well as delving into broader subject matter. He produces 15-20 daily news stories per day and works with the Connect team and clients to develop longer-form content, ranging from Q&As to thought-leadership pieces.
Prior to joining Connect, Paul was Managing Editor for both Real Estate Forum and GlobeSt.com at American Lawyer Media, where he oversaw operations at both publications while also producing daily news and feature-length articles. His tenure in B2B publishing stretches back into the print era, and he has served as Editor in Chief on four national trade publications.
Since 1999, Paul has volunteered as the newsletter editor of passenger rail advocacy groups (one national, one local).
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