Apartment market conditions continue to show improvement, according to the National Multifamily Housing Council’s quarterly survey of apartment market conditions for October
“We are continuing to see strong, broad-based demand for apartments as the U.S. economy remains on an upward trajectory,” said Caitlin Sugrue Walter, vice president of research at the NMHC. “Sun Belt markets, in particular, are witnessing historic levels of occupancy and rent growth, while most urban, coastal markets have returned to or even surpassed pre-pandemic levels.”
Findings from the survey, which was conducted between Oct. 18 and Oct. 25 and included 105 CEOs and other senior executives of apartment-related firms nationwide, include:
- The Market Tightness Index decreased from 96 to 82, indicating market conditions have become tighter. However, there was less agreement among respondents compared with the previous quarter. Nearly three-quarters, 71%, reported tighter market conditions than the three months prior compared with only 8% who reported looser conditions; 20% said they felt conditions were no different than the previous quarter.
- The Sales Volume index remained unchanged at 79, which signals continued strength in multifamily sales. More than half of respondents, 61%, reported higher sales volume than the three months prior, and 32% said volume was unchanged. Only 4% indicated lower sales volume from the previous quarter.
- The Equity Financing index inched down slightly from 69 to 65. More than half of the respondents, 52%, said they believed equity conditions hadn’t changed from the previous quarter, while 33% said it was more available. Only 4% of respondents indicated that equity was less available than the three months prior.
- The Debt Financing index was the only one of the four indices to fall below the breakeven level of 50, decreasing from 71 to 48 this quarter. The majority of respondents, 52%, reported unchanged conditions in the debt market, while 17% cited better conditions and 21% cited worse conditions than the three months prior.
“These strong fundamentals as well as a wide availability of equity financing have provided a solid foundation for continued transactions in the sales market,” Walter added.