Could the multifamily market be headed towards a “period of stagflation?” That's the question Andrew Semmes, Senior Research Analyst, poses in the Matrix May 2024 Multifamily Rent Forecast update.
“While we still need to be humble about the overall economic trajectory and the path the Federal Reserve takes, we believe we are probably still on track for a rate reduction by the end of the year,” writes Semmes.
Multifamily Rent Forecast Update
As the April BLS jobs report came back lower than expected, some of the stagflation fears have been relieved. However, just like the overall split in the general economy, multifamily is a “tale of two cities.”
Markets that saw significant growth during the pandemic—and that are now experiencing a large influx of supply—are seeing stagnant or falling rents, according to Semmes. This is most apparent in Florida, Texas, and other “pandemic high-growth markets.”
RELATED
- Multifamily rent growth rate unchanged at 0.3%
- Yardi Matrix updates near-term multifamily supply forecast
- Average U.S multifamily rents drop $3 to $1,718 in October 2023: Yardi Matrix
On the other hand, quite a few secondary markets are still seeing strong growth in asking rents. These markets are primarily in the Midwest, Northeast, and Southern regions, and include metros like Des Moines, Cincinnati, Northern Virginia, and Providence.
Yardi Matrix Multifamily Outlook for 2024
Yardi Matrix's overall outlook on the market remains mostly the same. Markets facing significant supply issues will continue to struggle to make gains; issues should be alleviated once new units get absorbed.
It's expected that the Fed will keep rates higher for a bit longer, so Matrix anticipates a minor downturn/recession will occur “a little later and perhaps last a little longer.”
Related Stories
MFPRO+ News | Dec 5, 2023
DOE's Zero Energy Ready Home Multifamily Version 2 released
The U.S. Department of Energy has released Zero Energy Ready Home Multifamily Version 2. The latest version of the certification program increases energy efficiency and performance levels, adds electric readiness, and makes compliance pathways and the certification process more consistent with the ENERGY STAR Multifamily New Construction (ESMFNC) program.
Transit Facilities | Dec 4, 2023
6 guideposts for cities to create equitable transit-oriented developments
Austin, Texas, has developed an ETOD Policy Toolkit Study to make transit-oriented developments more equitable for current and future residents and businesses.
Office Buildings | Dec 1, 2023
Amazon office building doubles as emergency housing for Seattle families
The unusual location for services of this kind serves over 300 people per day. Mary's Place spreads across eight of the office's floors—all designed by Graphite—testing the status quo for its experimental approach to homelessness support.
Industry Research | Nov 28, 2023
Migration trends find top 10 states Americans are moving to
In the StorageCafe analysis of the latest migration trends, each U.S. state was looked at to see the moving patterns of people in the last few years. These are the top 10 states that people are moving to.
Engineers | Nov 27, 2023
Kimley-Horn eliminates the guesswork of electric vehicle charger site selection
Private businesses and governments can now choose their new electric vehicle (EV) charger locations with data-driven precision. Kimley-Horn, the national engineering, planning, and design consulting firm, today launched TREDLite EV, a cloud-based tool that helps organizations develop and optimize their EV charger deployment strategies based on the organization’s unique priorities.
MFPRO+ News | Nov 21, 2023
California building electrification laws could prompt more evictions and rent increases
California laws requiring apartment owners to ditch appliances that use fossil fuels could prompt more evictions and rent increases in the state, according to a report from the nonprofit Strategic Actions for a Just Economy. The law could spur more evictions if landlords undertake major renovations to comply with the electrification rule.
MFPRO+ News | Nov 21, 2023
Underused strip malls offer great potential for conversions to residential use
Replacing moribund strip malls with multifamily housing could make a notable dent in the housing shortage and revitalize under-used properties across the country, according to a report from housing nonprofit Enterprise Community Partners.
MFPRO+ News | Nov 21, 2023
Renters value amenities that support a mobile, connected lifestyle
Multifamily renters prioritize features and amenities that reflect a mobile, connected lifestyle, according to the National Multifamily Housing Council (NMHC) and Grace Hill 2024 Renter Preferences Survey.
MFPRO+ News | Nov 15, 2023
Average U.S multifamily rents drop $3 to $1,718 in October 2023: Yardi Matrix
Multifamily fundamentals continued to soften and impact rents last month, according to the latest Yardi Matrix National Multifamily Report. The average U.S. asking rent dropped $3 to $1,718 in October, with year-over-year growth moderating to 0.4%, down 40 basis points from September. Occupancy slid to 94.9%, marking the first decline in four months.
MFPRO+ News | Nov 1, 2023
Washington, D.C., Queens, N.Y., lead nation in number of new apartments by zip code
A study of new apartment construction by zip code showed Washington D.C., and the Queens borough of New York City are the hottest multifamily markets since 2018, according to RentCafe.
