Capital Markets Multi-Housing, 2013 annual Market report

 Capital Markets Multi-Housing, 2013 annual Market report

2012 saw the continuation of sustained and broad-based noI growth in the multi-housing markets nationally. this revenue growth—coupled with low interest rates and plentiful investment capital—fueled the 47% growth in sales of apartments to $87 billion at year end. Cap rates for high-quality core assets were 4% or below in 10 markets and 5% or below in an additional 16 markets. Current valuations are above previous 2007/2008 peak pricing in eight markets, including San Jose/San Francisco, Manhattan and Denver. prices continue to lag significantly in Florida and the Southeast, but should improve as those markets continue to recover. Institutional owners have shown a willingness to accept lower unlevered returns for core multi-housing in primary markets of approximately 6.5% given the perceived stability of the multi-housing product. private investors, given positive leverage, are seeing current returns of high single digits and levered returns in the low- to mid-teens. Developers and buyers are willing to more seriously consider presales given the dearth of product in the market. Meanwhile, owners are seriously considering bringing portfolios to market due to perceived portfolio premiums.
 
 

on June 27, 2013