Berkadia has recently released a comprehensive report: Beyond Insights: Assessing Opportunities in an Oversupplied Multifamily Landscape. This report focuses on multifamily housing trends and provides valuable insights into which markets have the potential to withstand an oversupply in apartment units and the reasons behind their resilience.
The report highlights that the U.S. apartment industry is projected to reach a new supply peak in 2024, surpassing the demand for leasing activity. This oversupply can have significant implications for the market, leading to increased competition and potential challenges for property owners and developers.
However, the report identifies certain markets, particularly coastal regions like Florida, that are expected to be able to withstand this oversupply. The resilience of these markets can be attributed to several key factors.
Household formation plays a crucial role in determining the demand for housing. Florida, with its attractive lifestyle and favorable climate, continues to attract new residents, leading to an increase in household formation. This sustained demand for housing helps mitigate the impact of an oversupply of apartment units.
Rising employment levels in these markets contribute to their resilience. Florida, in particular, has experienced significant job growth in recent years, attracting both domestic and international businesses. This robust employment market creates a steady demand for housing, even in the face of an oversupply.
Income growth is another factor that contributes to the resilience of these markets. Florida has witnessed steady income growth, which enables residents to afford housing even in a competitive market. This factor further strengthens the market’s ability to withstand an oversupply of apartment units.
Berkadia’s report provides valuable insights for investors, developers, and property owners who are looking to navigate the multifamily housing market in 2024. By understanding the factors that contribute to the resilience of certain markets, stakeholders can make informed decisions and mitigate potential risks associated with an oversupply.
To access the full report and gain a deeper understanding of the multifamily housing trends and potential resilient markets, download the report today.
Sources
RealPage; Moody’s Analytics; Miami-Dade Beacon Council; South Florida Business Journal; The Real Deal; Miami Today
Stay ahead of the curve and gain a comprehensive understanding of multifamily housing trends by exploring Berkadia’s latest Beyond Insights series delivering timely economic and market-driven insights to better inform your commercial real estate investment decisions. With economic insights from interest rates to inflation, understand the impact of macroeconomic trends on the real estate capital markets. And dive into market trends from occupancy to cap rates, employment to migration trends, with the latest market-driven insights.
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