The latest National Multifamily Housing Council (NMHC) Quarterly Survey of Apartment Market Conditions for January 2024 shows a positive outlook for multifamily debt financing, marking the first time in over two years. However, other indicators such as market tightness and sales volume continue to decline.
According to NMHC’s senior director of research, Chris Bruen, this improvement can be attributed to a drop in the 10-year Treasury yield and signals from Fed officials about potential rate cuts in 2024. This has led to an increase in availability of debt financing after nine consecutive quarters of decline.
Despite this positive development, the apartment market is still facing challenges with decreasing rent growth and rising vacancy rates due to high levels of new supply entering the market – the highest seen in over three decades.
In terms of sentiment among respondents regarding debt financing conditions, nearly half reported improvements compared to none just three months ago. While some believe conditions have remained unchanged or worsened since October.
