Multifamily Investors Refocus Financing Criteria

The multifamily market enters 2019 after posting another exceptional year. There was an abundance of relatively inexpensive debt capital as well as equity available for investors, and rising rents and low occupancies made the market attractive despite high valuations. As a result, we saw record volume of multifamily activity in 2018, impacted by the large number of portfolio transactions.

It is unlikely that the market will change drastically in 2019, but it would be surprising, at this stage in the cycle, if it didn’t cool slightly as the year progresses. Since mid-2016, the 10-year treasury note has been trending slowly but steadily higher. The average yield for 2018 was 2.91 percent, higher than at any point since 2010.