Multifamily Market Moving

The Multifamily investment Market is out pacing other commercial property types in terms of growth of volume over the year. Sales of multifamily units were up in the first quarter over 30% compared to a year earlier and up 52% in 2011 compared to 2010.

In preliminary full first quarter numbers, CoStar is showing nearly $14 billion of apartment property sales in the first quarter vs. $10.5 million a year ago. The segment recorded $64.6 billion in sales last year vs. $42.5 billion in 2010. According to Fitch, Moody’s and Freddie Mac , positive news helps dispel some investor concerns by reporting that market fundamentals appear to support current valuations Even with new construction on the rise, it is outweighed by demand. Low levels of new apartment construction, Also the improving employment picture, and the weak single-family housing market are now contributing to solid fundamentals in the multifamily housing sector in as reported in U.S., Moody’s Investors Service. “For the multifamily REITs, the strong fundamentals have pushed occupancy and cash flow With foreclosures and short sales in the residual section  forcing many families to seek apartment living, with younger members of the population, who are significantly more likely to be renters rather than owners along with , given inexpensive capital and strong investor interest in the multifamily sector,  all helping growth past recent highs, Moody’s noted that pipelines of new development have been expanding, , “We do not foresee dangerous levels of new supply nationally for at least the next 12 months, though some specific submarkets could show some strain, and there may be enough new construction to moderate rents,” Wimmer said.  However, despite a reversal in the decline in multifamily completions in 2011, the supply of new multifamily units remains well below its historical averages. At the same time, the demand for apartments has been growing despite the lackluster employment picture. These movements seem to point to a solid market the multifamily market for some time]]>