Archive for February, 2012
NMHC, NAA comment on federal government’s housing plan
Representing both the National Multi Housing Council and the National Apartment Association, NMHC senior vice president of government affairs Cindy Chetti praised the Federal Housing Finance Agency for proposing separate fixes for the single-family and multifamily housing markets.
The comments came after the FHFA announced its intentions to unwind its conservatorships of Freddie Mac and Fannie Mae. Chetti noted the differing initiatives to fix both the for-sale and rental housing sectors is vital to the overall goal of repairing the nation’s real estate crisis.
“We commend FHFA for recognizing that the GSEs’ multifamily programs are working well, were not part of the housing meltdown and require a separate solution from single-family housing finance reform,” said Chetti.
One suggestion Chetti made on behalf of the NMHC and NAA was for the FHFA to implement separate timetables for the winding down of Freddie and Fannie, citing the different states of the single-family and multifamily markets.
One way in which Freddie is working to help fix the housing market is to continue offering real estate-owned properties to investors for conversion to rentals. Once purchased, these investors would likely hire property managers, thus providing a boost to the rental management industry.
Investors’ eastern interests evolve as D.C. conditions change
Experts are becoming concerned about the potential for oversupply in the rental market around the nation’s capital, they indicated at the RealShare Apartments East conference.
Some remain positive when they look at the near future of rental housing, citing strong fundamentals, available debt and equity and the currently limited development pipeline for multifamily properties, GlobeSt.com reports.
At the same time, panelist Wistar Wood told conference attendees he thinks the D.C. metro area in particular may see less of a strong trend due to a large number of units scheduled to open soon, a concern he indicated applies to some other areas of the East Coast as well.
Enough time has passed since the demand for rental housing began to rise that developers are beginning to complete units in significant numbers. If demand is met in some submarkets, those areas may experience downward pressure on rents due to the increased competition.
At the same time, other markets in the region were cited as stronger areas drawing more of the panelists’ attention. In particular, Boston, Nashville, New Jersey, North and South Carolina and New York City were all mentioned as areas that might be ripe for investment as D.C. begins to cool.
Owners and prospective investors in these areas may wish to investigate rental property management companies to find one suitable for helping them make the most of this opportunity.
The panelists also indicated that, whatever the conditions in specific areas, the industry’s overall trend is expected to be a positive one.
This year’s rental market carrying momentum from 2011
Despite some issues caused by low job growth and stagnant incomes, rents may continue to increase during the coming years in the nation as a whole.
Low supply, high demand and cheap debt made 2011 an exceptional year for the apartment sector, real estate finance firm Green Street Advisors told the National Association of Real Estate Investment Trusts.
The sector experienced about 40 percent returns in the past three years, as Americans flocked to rental properties and chose not to pursue homeownership, and fundamentals remain strong. Rent growth has begun to slow, but is expected to be between 3 and 7 percent. It may be higher in markets that have barriers to new construction.
Those areas which do experience new construction are likely to see rent growth slow faster as supply increases, but the amount of time it takes for construction to finish could delay that result in some cases.
With the limits on supply and the number of single-family homes currently vacant, many experts suggest this year is a good time for rental managers and owners to raise rents, whether they hold apartments of single-family rentals.
