Posts Tagged ‘fannie mae’

Paradigm Shift for Multifamily and CRE Stock markets rallied after this week’s CPI print showed lower inflation, but the path to lower interest rates may not be as quick or straightforward as some would hope. With continued low CRE property sales and a narrow cap rate-interest rate spread, investors looking for investment opportunities are turning…

With Rate Hike Pause, Will Investors Buy More CRE? With recent data showing that multifamily loan originations are down 50% from last year (and down by 40% compared to pre-pandemic 2019 numbers), there is a growing discussion about the changing state of multifamily lending. The Fed’s rate hike pause last week was followed by some…

With Rate Hike Pause, Will Investors Buy More CRE? Despite several recent indicators of persistent inflation and greater economic activity, the Federal Reserve did not increase (or decrease) the federal funds rate this month. For CRE investors waiting to buy (or sell) properties, a rate hike pause may not be enough to encourage their re-entry…

Fed Says CRE Prices Are Still Too High Investors continuing to grapple with slow-moving CRE pricing trends are well in line with the results of the Federal Reserve’s recent survey on financial stability, which noted that commercial real estate valuations have not fallen at a rate commensurate with the increase in interest rates. While apartment…

Loan Maturities Update: Is Distress Around the Corner? Reports of persistently-high expenses for commercial real estate operators, extended periods of higher interest rates, and lower rent growth have compounded the potential for distress linked to the wave of multifamily loan maturities due in Q4 of this year. Solid, long-term fundamentals and robust housing demand continue…

Fed’s 2024 Projection: Funds Rate at 5.1% by End of Year  The Federal Reserve decided this week to maintain the current Federal funds rate without an increase (or decrease), but their updated economic projections suggest that the Fed is more driven to sustain these elevated rates through 2024, increasing their end-of-year 2024 projection from 4.6%…

CPI: Inflation Up 3.7% YoY, Multifamily Implications The Consumer Price Index’s recent numbers for August showed a substantial monthly increase of 0.6% that was driven largely by rising gas prices, but when excluding food and energy prices, price growth continued to decelerate as shelter costs and moderating rent growth brought core inflation to a mere…

Near-Term Struggles and Long-Term Strength for Multifamily Year-over-year rent growth has been consistently decelerating for over 18 months since its peak in late-2021/early-2022, and recent reports on the apartment market show year-over-year rent growth heading into negative territory after 18+ months of deceleration from its peak in late 2021/early-2022. Alongside lower rent growth and higher…

“Secret” Distress, Quiet Capital Markets, and a Rent Growth Reality Check While low CRE sales activity has some looking for hidden distress, reports on the apartment market are showing decelerating rent growth in recent months that could erode the steady month-over-month gains in the first half of the year. Given the close correlation between the…

Looking Beyond the 2023 CRE Market Cooldown Mid-year updates and forecasts for the apartment and CRE markets uniformly note the improved economic conditions compared to the start of the year, but forecasts for rent growth and capital markets are diverging. Under one scenario, a recession in late 2023/early 2024 will prompt an interest rate reduction…