January 23, 2019
The Market Outlook for 2019 
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The Market Outlook for 2019

Despite some macroeconomic and supply concerns, a number of market watchers say the outlook for multifamily in the year ahead looks good. Freddie Mac expects another strong year for the multifamily market in 2019 with solid rent growth and vacancies continuing to perform at historical averages. And the market’s strong fundamentals are exactly why some argue that the multifamily cycle still has room to run.

While rents may globally rise, some industry experts predict that the strongest rent growth will be in class-B apartments. While class-A apartment rents are also expected to grow, albeit at some more moderated rates due to supply pressures, affordability pressures are likely to slow rent growth for class-C and -D apartments.

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Multifamily Targeted for Opportunity Zone Investments

Many investors appear to be zeroing in on multifamily as a real estate segment ripe for investment under the Opportunity Zone program. However, it’s unclear how much affordable housing the program will actually spur in local areas. Plus, see how the debate is playing out in Portland.


Government Shutdown Poses Threat to Housing Industries

As the government shutdown drags on, the negative effects on housing are coming into focus. Thousands of low-income households are unable to pay rent, as the shutdown has disrupted rental assistance payments. Moreover, a number of government programs and agencies are affected, causing additional issues for multifamily. Along with other housing groups, NMHC continues to press for a shutdown solution.


Fed Says Student Debt Has Hurt the U.S. Housing Market

From the WSJ: “The Federal Reserve has linked rising student debt to a drop in homeownership among young Americans and the flight of college graduates from rural areas, two big shifts that have helped reshape the U.S. economy.”


Rent Control Discussions Continue in California

Voters may have voted down Prop 10, an aggressive rent control ballot measure, but California Governor Newsom says conversations on rent caps are still ongoing. Further testament to the his focus on the state’s housing crunch, the governor has also threatened to cut state funding from cities that don’t approve enough housing.


European Coliving Company Raises $1B, Plans U.S. Expansion

Berlin-based Medici Living recently raised $1.1 billion, marking what it says is the largest investment in the emerging sector. The capital raise will fuel its European and American expansion plans. Roughly $300 million is earmarked for U.S. expansion over the next three years.


Microsoft, Kaiser Announcements Prompt NMHC Letter to the Editor

In the past week, tech leader Microsoft pledged $500 million to tackle the housing crisis in Seattle and Kaiser Permanente announced the pharma giant would spend $5.2 million on affordable housing in Oakland. In a letter to the editor of The Mercury News, NMHC’s Doug Bibby praised the moves, saying, “These types of investments and public-private partnerships are what we need to spur substantive change in the housing market.”
In Case You Missed It
A hand-selected collection of noteworthy articles on a wide variety of issues of interest to apartment executives.
Multifamily Market Dashboard

The Most Influential Factors in Student Housing Costs

Traditional student housing cost comparisons have largely ignored the fact that on-campus and off-campus housing units rarely have identical features or amenity offerings. Our most recent Research Notes draws on proprietary analysis that controlled for these factors and features, allowing for more an apples-to-apples cost comparison of student housing costs and value.

Aside from estimating inherent premiums or discounts associated with living in specific housing types like on-campus dorms versus purpose-built off-campus student housing, the analysis also revealed several housing characteristics and features that influenced the pricing of student housing options—distance from campus, in-unit bathrooms and roommates.  

Compared with living alone, a student living in off-campus purpose-built student housing could expect to pay 19 percent less per year to live in a purpose-built apartment with one other roommate, 14 percent less with two roommates and 8 percent less with three roommates.

Figure 1. Average Annual Per-Bed Rent by Students per Unit

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About Apartment Wire
A must-read for top apartment industry professionals, Apartment Wire is a timely review of emerging trends in apartment finance, development, management and technology and more, featuring both exclusive content from NMHC's staff of experts and provocative articles from across the web.
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