Apartment market conditions continued to weaken in the National Multifamily Housing Council’s (NMHC) Quarterly Survey of Apartment Market Conditions for July 2023, as the Market Tightness (26), Sales Volume (40), Equity Financing (22) and Debt Financing (18) indexes all came in well below the breakeven level of 50. The Debt Financing Index represented eight consecutive quarters of declining availability.
Caitlin Sugrue Walter, NMHC’s VP of research commented that “both debt and equity capital continue to pull back from the apartment market amidst an environment of rising interest rates and slowing rent growth.” This has caused transaction volume to fall for five consecutive quarters, with current apartment owners unwilling to offer lower prices buyers deem necessary due to a diminished economic outlook. However, as Federal Reserve nears its tightening cycle end there is a small but growing share reporting increased deal flow activity in apartments markets.
