Widespread Improvement Continues for Apartment Industry, According to NMHC Quarterly Survey of Market Conditions

WASHINGTON, Aug. 6 /PRNewswire/ -- The apartment market's rebound continues to gain momentum, according to NMHC's latest Quarterly Survey of Apartment Market Conditions.

Sales volume is up, debt and equity are more available and markets are tighter. Indexes for both sales volume and equity financing registered all-time highs.  The biggest improvement came in debt financing, which jumped from 58 to 81.

"Apartment market conditions continue to improve across the spectrum," said NMHC Chief Economist Mark Obrinsky.  "Indeed, the average for all four NMHC indexes set a new record for the second quarter in a row."

"The strong responses in each of our last two surveys indicate widespread improvement over the last six months," Obrinsky continued.  "Demand for apartment residences has substantially increased thanks to modest improvements in the jobs market and the continuing decline in homeownership rates.  While the level of transactions remains subdued compared with the boom years of 2005-2007, activity is gradually growing from the low levels of late 2008-early 2009."

"Going forward, the near-term outlook for the apartment industry is likely to be tied to the pace of job growth," Obrinsky added.  "Over the longer term, positive demographic trends are likely to keep the demand for apartments growing."

Key findings include (for all four indexes, figures above 50 indicate improving market conditions):

• The Debt Financing Index increased dramatically, from 58 to 81, meaning borrowing conditions have improved.  A full 64 percent of respondents said conditions for multifamily borrowing were better this quarter than last.  This is the second-highest debt financing figure in the history of the series.  Only three percent reported worse conditions.  
• The Market Tightness Index, which measures changes in occupancy rates and/or rents, rose from 81 to 83.  Fully 69 percent of respondents said markets were tighter (meaning lower vacancies and/or higher rents).  This was the sixth straight quarter in which this measure has risen, and is the highest figure since July 2006.    
• The Sales Volume Index increased from 72 to a record-setting 78.  Sixty-one percent of respondents indicated sales volume was higher.  This was the second consecutive record level in this index, and an indication of widespread improvement.
• The Equity Financing Index increased again from a prior record 71 to a new
  record 73, indicating that equity financing is more available.  Nearly half — 48 percent — indicated that equity financing was more available, another record.  This is the seventh straight quarter of improvement for this index.

Full survey results are posted at www.nmhc.org/goto/quarterlysurvey.

Based in Washington, DC, NMHC is a national association representing the interests of the larger and most prominent apartment firms in the U.S.  NMHC's members are the principal officers of firms engaged in all aspects of the apartment industry, including owners, developers, managers and financiers.  One-third of Americans rent their housing, and over 14 percent live in a rental apartment.  For more information, contact NMHC at 202/974-2300, e-mail the Council at [email protected], or visit NMHC's web site at www.nmhc.org.

CONTACT:  Michael Tucker, +1-202-974-2360, [email protected]

SOURCE National Multi Housing Council