Posted on 04/09/2023 5:18:26 AM PDT by cutty
Multifamily sales in the first quarter of 2023 were roughly $40 billion lower than the previous year ... marking a slowdown in one of the hottest real estate markets amid growing interest rates and banking turmoil.
...
Investors acquired just under $14 billion in apartment buildings nationally in the first quarter of this year ...
The number represents a 74% year-over-year decline, the largest decrease since the first quarter of 2009, when sales fell 77%..
It was also the lowest sales quarter for the market since early 2020, right after COVID-19 broke out and threw the rental residential market into uncertainty.
The apartment market thrived during the pandemic, spiking at a record $116 billion in the last quarter of 2021, largely due to rent increases and nationwide housing shortages. Over the past six months, however, rents have plateaued while the Fed has continually hiked interest rates, making it more difficult to finance real estate purchases. Because of the increase in liquidity during the pandemic, many buyers acquired their properties at record-high prices, making it especially difficult to now sell off the assets.
On top of interest rate hikes, recent turbulence, like the collapse of Signature Bank, is expected to further squeeze real estate values. Regional banks like Signature are the primary lenders for commercial real estate investments; nearly half of Signature’s total loans at the end of 2022 were for real estate.
...
Multifamily isn’t the only struggling real estate sector. The office industry has been particularly hard-hit by pandemic-era remote or hybrid work policies. Many employers are downsizing their footprints for newer, smaller office spaces to accommodate a reduced in-person workforce, leaving owners of older offices to either redevelop or default on their loans.
(Excerpt) Read more at forbes.com ...
Create a worldwide pandemic
Hand out rent moratoriums to RENTERS
Freeze rents
Hold landlords & banks hostage for mortgage payments
Cripple the entire mortgage/rental industry with ‘rules’.
Doesn’t take long for landlords to QUIT
That’s what I was guessing. My property is in Wewahitchka and there’s not much happening there, thank goodness.
I’m sure you’re right about what’s coming. Sickening.
Somebody who understands economics! You are a true unicorn on Free Republic
Yes, you are completely correct. This story is about apartment complexes whose units are rented, and about the entire apartment complex being bought.
Nothing to do w individual condos.
For every buyer there is a seller?
So is this REALLY bad news?
Is it even News?
The ultimate liberal dream is to have the power to dictate where people live.
Do nearly no Freepers read past the headlines?
Here’s the reason why
“Over the past six months, however, rents have plateaued while the Fed has continually hiked interest rates, making it more difficult to finance real estate purchases. Because of the increase in liquidity during the pandemic, many buyers acquired their properties at record-high prices, making it especially difficult to now sell off the assets.”
Simple economics and financial logic.
Which are hard to grasp for all too many
I’ll bet nobody has bought a home at a “hyper inflated price” in any of those markets since World War II.
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