Post Brothers’ Post

Q2 apartment demand surged leading to near record high absorption. Does this sound familiar? Earlier this year we highlighted that “absorption levels in Q1 of 2024 nearly doubled that of historic Q1 trends” According to RealPage, Inc., nearly 400k apartment units were absorbed in the last 12 months. Despite current near record high demand, supply growth continues to outpace. It’s anticipated that nearly 630k apartment units will come online in the next 12 months. Despite the supply/demand gap tightening, it’s likely that supply side pressure will remain scrutinized. In speaking with local apartment leasing consultants, multifamily management firms seem to be reintroducing concessions to help stabilize occupancy. As reported by Yield PRO media, 80% of US renters believe now is not a good time to buy a home. Given the ongoing challenges of achieving homeownership, the affordability of renting compared to owning will help sustain strong demand. There continue to be signs of future supply contraction. GlobeSt.com reports that since the pandemic, multifamily construction permits are down 30% due to high interest rates, elevated construction costs, and increased product saturation. It’s to be seen how a slowdown in starts could impact rents. #cre #commercialrealestate #multifamilyrealestate #multifamilyinvesting #investmentsales #slnusbaum

Please see this well-described analysis of apartment supply and demand from SL Nusbaum. Given a large amount of product just now coming online that was financed in a lower interest rate environment, new supply should be slowing down considerably. Along with the greater availability of units including some returns to rental concessions in some areas, I believe we will be back to a supply deficit compared to demand shortly. #slnusbaum #apartment #multifamily #development #absorption #appraisal #commercialappraiser

The multifamily market is showing surprising resilience despite the challenges of recent years. As rents begin to rise in cities with limited new construction, apartment owners may finally see some relief from elevated costs and competition pressures. However, this trend could have broader implications for the CRE industry, particularly concerning interest rates.

Rental Demand Stays Robust. Houston and Dallas have experienced the first and second strongest recovery rates, respectively, among the nation’s largest markets; in Dallas, occupancy rates have stabilized around 90%. Fewer New Deals: “Razor-thin” yield margins and increased financing costs have contributed to a significant slowdown in new development deals. Some developers are pausing new projects to allow the current supply of multifamily units to be absorbed. #Multifamily #RealEstate

Multifamily rents continue to rise slightly as the market absorbs the steady supply of new apartments.  Over the next year or two, it may take longer to lease up new properties in high-supply Sun Belt markets.

The multifamily real estate market in Central Florida exhibits promising signs, with strong rent growth, high demand, and limited supply. Affordability favors renting over homeownership, fueling substantial demand despite increasing deliveries. Occupancy rates remain strong, with decreasing concessions indicating favorable market conditions. Collectively, these trends offer opportunities for prospective investors seeking to capitalize on the region's favorable multifamily market dynamics. #CentralFloridaRealEstate #MultifamilyMarket #RentGrowth #HighDemand #LimitedSupply #AffordableHousing #RealEstateInvesting #OccupancyRates #MarketConditions #InvestmentOpportunities

Way too many units have been built. Pull a demand study in any major market and there are thousands of units of negative demand in the next 36 months. I recently read a report showing that there are over 18k units under construction in the Miami area. Only 2k units were absorbed in the T12 months. In the Ft. Meyers MSA, there have been 4900 units brought online in the last 24 months with another 2900 coming online in the next 24. That market is currently at 12% vacancy in Class A. Imagine what another 2900 units will do. This is another major issue we're all going to need to deal with in multifamily.

The greater Portland multifamily market experienced a resurgence of demand in Q1 2024 as renters absorbed more than 1,300 units on a net basis. While new supply did slightly outpace demand, resulting in a seventh consecutive quarter of declining occupancy, the number of units absorbed in the first three months of the year is the highest Q1 absorption figure since 2021. Find the full Q1 2024 Portland Metro Multifamily Market Report from Colliers here: https://lnkd.in/eHUH3K6n

Reno Multifamily Report: A Q3 Recap The Reno/Sparks multifamily market exhibited a subtle decline in rental rates during Q3, with an $8 decrease compared to the previous quarter, reaching $1,653. Despite being a typical peak season, this average falls $1 short of Q3 2022, indicating a market stabilization. The overall vacancy rate increased to 2.73%, highlighting the continued strong demand for rental properties in the area. However, it's crucial to note that the rent rate and vacancy data only encompass stabilized 80+ unit properties with 90% occupancy. Several new projects are taking longer to achieve stabilization, leading us to believe that the underlying vacancy rate for the entire market, including smaller buildings, is higher. Numerous new properties in the lease-up phase are offering concessions, and we've observed an unusually high surplus of rental listings. The number of units planned or under construction for multifamily properties increased slightly to 10,620 units. The most significant obstacles to new supply continue to be the limited availability of developable land, rising prices, and increasing construction costs. Meanwhile, on the demand side, job growth remains robust as more corporations seek to expand or relocate to the area. Nevada has seen a high influx of inbound moves, which may be driving demand for housing. Furthermore, affordability concerns in the single-family housing market have further elevated the demand for multifamily properties. Overall, the Reno/Sparks rental market appears to be leveling off, with a slight decrease in rental rates and a modest increase in the vacancy rate. While demand remains strong, the market is showing signs of softening due to the prolonged stabilization of new projects and the increased availability of rental listings. To view the full report visit https://lnkd.in/gcaXKTTT #Reno #Sparks #Multifamily #RentalMarket #Q3 #Report

In the latest issue of Midwest Multifamily & Affordable Housing Business, Interra Realty Senior Managing Partner Joe Smazal, alongside other Chicago multifamily experts, gave their insights on what makes Chicago such a steady performer in the multifamily sector, and how Chicago's rent growth is outpacing the rest of the country. "Chicago’s market is historically slow and steady. We are insulated from big swings." Read the full article here: https://lnkd.in/g9sqt927