The overall vibe was optimistic about the future of multifamily housing at the MFE Conference. Industry leaders gathered Sept. 30 to Oct. 2 at the Fontainebleau Las Vegas to share top-level strategies and insights.
Here are some of the key takeaways from the event:
1. Rental Advantage: When looking at rent versus own, Zonda chief economist Ali Wolf said this is the strongest the industry has ever seen it. “It moved from 6% more expensive to own a home to 60%,” she said. “That will change, and that will compress over time and go back toward that norm. I don’t think 6% is coming back, but that’s an important stat when you think about interest rates as they start to come down.”
2. Starts and Completions: Multifamily completions are at a 30-year high, while starts have slowed dramatically because of financial feasibility and economic uncertainty. “We do anticipate multifamily housing starts will remain limited and challenged going through next year,” Wolf said, noting for 2025, Zonda projects 350,000 multifamily starts. “The general thesis is that we have in some markets a temporary oversupply, but since we have had such a dramatic pullback in housing starts, we do anticipate seeing more growth and are hearing about deals picking back up. We’re calling for more notable starts to start ticking up in 2026.”
3. Housing Shortage: Even with the recent supply influx, keynote presenter Spencer Levy, global client strategist and senior economic adviser at CBRE, touted that multifamily is a great place to be today because of the nation’s housing shortage. “If you have the courage to start building, you’ll be in a good place in three years,” he shared with the audience.
4. Leadership Optimism: UDR chairman and CEO Tom Toomey weighed in on the Fed’s first rate cut in over four years in mid-September. “I think the first rate cut, the characterization I would have, the fourth quarter is just a hold. Rates are coming down, my assets now look a little better, cap rates are coming down. We’ll see how it transacts in the marketplace,” he said. “In 2025, for us, we’re just going through our business plan cycle, and it looks a lot like normal. There are a handful of markets that are going to have rent growth above 5%, and there are a handful that are going to be -5%. With 21 markets, we see a pretty steady year. I think there are a lot of things you have to anchor yourself to: the 10-year Treasury, we’re all trying to borrow money at 5%, and we think that’s sticky; cap rates are going to hover around 4.5% and 5.5%; so as we look at 2025, it almost feels like relief at this juncture.”
Kurt Houtkooper, CEO of Hamilton Zanze Real Estate Investments, said the 50-basis point reduction by the Fed eases monetary policy. “For us, that means capital deployment and a conviction that now is the time to buy. We are actively pursuing opportunities today,” he said. “We feel really good about the future of multifamily, and now we know the direction of capital markets—game on.”
Centerspace president and CEO Anne Olson added she thinks the industry is going to start to see more transaction volume; however, there is going to be a waiting game. “As we move to normal, there may be some people who are early movers who get an advantage or make a bet too early,” she said. “I am really optimistic about 2025. We’re also trying to budget to normalcy or move toward some sort of norm, but I think one of the things I’m proud of in our organization is how flexible we have become during these times to try to figure it out and react.”
5. Policy Watch: “Regulation is going to be a big theme in 2025. We’re going to see a lot coming out of both the federal election and how that plays out locally,” said Olson.
Toomey told attendees it’s important to get more involved with local National Apartment Association chapters or the associations that represent your constituents the best and to go into local government meetings to make the case for more building. “Give us capital, and we’ll provide housing,” he said.
6. Rethinking Real Estate: Author Dror Poleg shared some advice with the audience during his keynote presentation. “Build a brand that stands for something,” he said, noting that a main risk is just being average. Poleg’s other takeaways for the industry included take the opportunity to be part of shaping the legislative environment, embrace uncertainty, make bolder bets, and simply have fun.
7. Centralization and Communication: While many multifamily companies are moving to some form of centralization, engagement with site teams is critical. “We have learned overcommunicating is the way to go,” shared Gigi Giannoni, senior vice president of customer experience and marketing at Gables Residential. “If we don’t get buy-in [from site teams], it’s hard to implement.”
8. Tech Talk: Keynoter Ivo Van Breukelen, managing partner of The Proptech Connection, gave the audience a warning—“Tech is here, tech is coming, and if you stay behind you’re losing.”
9. AI Adoption: Toomey said he believes artificial intelligence (AI) is just at the cusp. “The industry has always been behind the curve on technology. I think it can accelerate the implementation in so many things, and we have to be brave as leaders to try.”
10. Breaking Through the Noise: The average person sees 6,000 to 10,000 ads every day, noted keynote presenter Hilary Billings, co-founder and CEO of Attentioneers. “Attention is no longer deserved, it’s earned,” she told the audience. She shared three factors for creating online content:
- Grab attention: Billings said you have 0 to 2 seconds to make an impact, so it’s key to save the best for first;
- Spark an emotion: “Humans act emotionally,” she said. “When people get emotional, they get promotional and will hit the share button;” and
- Create a curiosity gap: Leave something out intentionally so viewers ask, “what happens next?”
11. Building a Brand: With renters having a lot of options today, it’s important to make your community brands stand out. A mark of a great brand is creating an emotional connection and getting a visceral reaction, noted Noel Carson, vice president of marketing and creative director at Bozzuto. “Emotion is a great way to get people say, ‘this is home,’” added Nina Daly, senior art director, branding strategies, at Stantec. One way is to create a narrative that tells a story and shows prospective renters why they would want to live at a community.
