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Subjects: Survey, Economic News/Analysis

Apartment Market Continues to Loosen, Transactions Pull Back Further Due to Rising Cost of Capital

Apartment market conditions continued to weaken in the National Multifamily Housing Council's (NMHC's) 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 (50).

"Both debt and equity capital continue to pull back from the apartment market amidst an environment of rising interest rates and slowing rent growth," noted NMHC's Vice President of Research, Caitlin Sugrue Walter. "As a result, transaction volume fell for the fifth consecutive quarter, with current apartment owners unwilling to offer the lower prices buyers deem necessary to compensate for this diminished economic outlook."

"Yet, as the Federal Reserve nears the end of its tightening cycle, a small but growing share of respondents are finally starting to report a pickup in apartment deal flow."

About the Survey:

The July 2023 Quarterly Survey of Apartment Market Conditions was conducted from July 10-17, 2023. 88 CEOs and other senior executives of apartment-related firms nationwide responded.

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