EPISODE · Sep 25, 2023 · 1H 3M
Interest Rate Reality Check for the Multifamily Market
from The Gray Report Podcast · host Spencer Gray
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% in June to 5.1% now. While CRE pricing has been trending down since the start of this elevated interest rate regime, these extended projections of lasting high rates could accelerate further price discovery, especially in the context of the dramatic increase in loan maturities coming due in Q4 2023 and early 2024. Sources discussed in this episode: CBRE: Midyear Pulse Check: U.S. Multifamily Market - https://www.cbre.com/insights/briefs/midyear-pulse-check-us-multifamily-market RealPage: “Class A Rent Performance Weighing Down Some Apartment Markets” - https://www.realpage.com/analytics/class-a-underperformance/ RealPage: “Flip the Script: Wage Growth Is Outpacing Rent Growth Again” - https://www.realpage.com/analytics/wage-growth-outpacing-rent-increases/ Yardi Matrix: “Multifamily Rent Forecast Update” - https://www.yardimatrix.com/publications/download/file/4482-MatrixBulletin-MultifamilyForecast-August2023 Cushman & Wakefield: “Market Matters” - https://www.cushmanwakefield.com/en/united-states/insights/market-matters-exploring-real-estate-investment-conditions-and-trends For the latest multifamily news from across the internet, visit the Gray Report website: https://www.grayreport.com/ Sign up for our free multifamily newsletter here: https://www.graycapitalllc.com/newsletter DISCLAIMERS: This podcast does not constitute professional financial advice and is for educational/entertainment purposes only. This podcast is not an offer to invest.
What this episode covers
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% in June to 5.1% now. While CRE pricing has been trending down since the start of this elevated interest rate regime, these extended projections of lasting high rates could accelerate further price discovery, especially in the context of the dramatic increase in loan maturities coming due in Q4 2023 and early 2024. Sources discussed in this episode: CBRE: Midyear Pulse Check: U.S. Multifamily Market - https://www.cbre.com/insights/briefs/midyear-pulse-check-us-multifamily-market RealPage: “Class A Rent Performance Weighing Down Some Apartment Markets” - https://www.realpage.com/analytics/class-a-underperformance/ RealPage: “Flip the Script: Wage Growth Is Outpacing Rent Growth Again” - https://www.realpage.com/analytics/wage-growth-outpacing-rent-increases/ Yardi Matrix: “Multifamily Rent Forecast Update” - https://www.yardimatrix.com/publications/download/file/4482-MatrixBulletin-MultifamilyForecast-August2023 Cushman & Wakefield: “Market Matters” - https://www.cushmanwakefield.com/en/united-states/insights/market-matters-exploring-real-estate-investment-conditions-and-trends For the latest multifamily news from across the internet, visit the Gray Report website: https://www.grayreport.com/ Sign up for our free multifamily newsletter here: https://www.graycapitalllc.com/newsletter DISCLAIMERS: This podcast does not constitute professional financial advice and is for educational/entertainment purposes only. This podcast is not an offer to invest.
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Interest Rate Reality Check for the Multifamily Market
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