Learn what industry experts are seeing as indicators of multifamily market recovery
The pandemic is far from over, but multifamily investors may be able to breathe a (somewhat cautious) sigh of relief.
Why? Join us as we hear from industry experts to find out, and what this means for multifamily market recovery.
Record of resilience
Multifamily has long been lauded as more stable and resilient than other investments during an economic downturn or recession.
So far, this is holding true. For the most part, the multifamily sector “has defied gravity given what we’ve seen in the job market,” says Kimberly Byrum, managing principal, multifamily, at Meyers Research, in a recent Multifamily Executive article. [1]
Demand for new units has stalled across the country, but occupancy rates remain high—especially as more tenants are continuing to work from home. During the start of the COVID-19 pandemic, apartment residents froze in place, with the nation seeing the highest renewal rates in April.
Related:
5 emerging apartment must-haves in the wake of COVID-19
National Multifamily Housing Council’s Rent Payment Tracker tells the same story of resilience. August 2020 rent payments were down only 1.3% from last year’s total, coming in at 94.5%. This figure is truly astonishing when we consider the fact that many rental assistance programs have now come to an end across the nation.
CRE experts are confident about the future
55% of respondents to Berkadia’s 2020 Mid-Year Powerhouse Poll (conducted in early July with insights from nearly 150 investment sales brokers and mortgage bankers) agreed that the current market activity is better than expected compared with their initial thoughts on COVID-19’s impact. [2]
What does this mean for multifamily market recovery? 69% of those surveyed said they expect that capital conditions will return to normal next year.
“COVID-19 continues to have a profound impact on our economy, and while no industry is immune, we have been buoyed by the resiliency of commercial real estate, including steady rent collection and continued deal activity,” says Ernie Katai, executive vice president and head of production at Berkadia, as quoted by Multifamily Executive. [2]
What we’re seeing in Orlando
We’re really impressed to see rent holding up so well in the face of a worldwide pandemic, especially when the federal unemployment assistance ran out in July. In Orlando, more support is on the way—with a newly announced rental assistance program which proposes to distribute more than $1.5 million to affected residents. [3]
We’re also seeing renewed interest from multifamily investors. “Moving into the second week of September, the team at 100Units.com has the most deals listed and the most deals under contact we’ve had in four years,” says Joe LaFleur, multifamily investment advisor. “It’s great to see investors looking to multifamily as a safe haven asset and as a place they’re excited to put their money to work.”
Stay informed
We’re continuing to follow the multifamily market closely, and will continue to share up-to-the-moment news and insights on Facebook and LinkedIn, as well as on our blog.
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Sources:
1: Byrum: Positive Signs for the Multifamily Sector | Multifamily Executive
2: Commercial Real Estate Shows Resiliency During COVID-19 | Multifamily Executive
3: Mayor Dyer Announces Plans to Launch COVID-19 Rental Assistance | City of Orlando
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