Thursday, September 24, 2020

Landlords Report a 75% Rise in Evictions Since the Start of COVID-19 via Multifamily Executive Magazine

More than half of residential tenants are currently struggling to pay their rent, largely as a result of the COVID-19 pandemic, according to a new survey of property managers released by real estate technology company Snappt. One-quarter of these residents are paying late, while 17% pay less than full rent and 11% have stopped paying altogether.

Respondents to the 2020 Effects of the COVID-19 Pandemic on Residential Rentals Survey reported that evictions have risen by 75% since the start of the COVID-19 pandemic, with a current eviction rate of 21%.

Read more...Landlords Report a 75% Rise in Evictions Since the Start of COVID-19 via Multifamily Executive Magazine

Texas Economy Improves Despite Lagging Sectors as COVID-19 Cases Decline via Dallas Fed

Continued growth is projected for the rest of the year, but it may be somewhat restrained by the expiration of federal stimulus programs and election uncertainty. Small-business closures may accelerate if the economy doesn’t strengthen sufficiently.

Risks to the outlook are to the downside and include a possible resurgence of the virus and sustained lower oil prices. Early arrival of a safe and effective COVID-19 vaccine would be a game changer, although it would take time for broad dissemination and administration.

Read more...Texas Economy Improves Despite Lagging Sectors as COVID-19 Cases Decline via Dallas Fed

Renters more pessimistic than homeowners during economic downturn via Real Estate Center

The Census Bureau has released phase two of its Household Pulse Survey (HPS) after a month-long hiatus. This round includes new questions regarding respondent sentiments on the likelihood of either eviction or foreclosure.

Throughout the summer, the HPS revealed a stark difference in optimism between homeowners and renters. Texas homeowners typically felt more likely to be able to make their next housing payment than renters.

Read more...Renters more pessimistic than homeowners during economic downturn via Real Estate Center

Wednesday, September 23, 2020

Apartment Leasing Rebounds to Normal Levels via GlobeSt

The pandemic immediately impacted apartment leasing activity, but about six-weeks into the pandemic, leasing activity rebounded to normal levels. Quarantine, distance learning and work-from-home policies encouraged people to move to more accommodating homes, driving leasing demand. However, the leasing process has changed since the onset of the pandemic, and those changes—virtual leasing—will take longer to return to normal.

Read more...Apartment Leasing Rebounds to Normal Levels via GlobeSt

How Some Multifamily Metrics Can Mislead in This Current Environment via GlobeSt

As a provider of joint venture and general partner equity, real estate investment firm RanchHarbor has been seeing an influx lately of multifamily investment opportunities presented by sponsors as value-add. However, upon a closer look at the underwriting, these deals do not actually fit the typical value-add investment profile, says Adam Deermount, co-founder and managing director of the company. Instead, these opportunities end up being cap rate compression plays under the guise of value-add and are priced to perfection in today’s market.

“Most of the return on investment is generated by rent inflation buoyed in the early years of the investment by positive debt service arbitrage due to interest only terms,” Deermount tells GlobeSt.com.

Read more...How Some Multifamily Metrics Can Mislead in This Current Environment via GlobeSt

We Are Living in the Weirdest Real Estate Market Ever via D Magazine

Nothing is normal in this year of the pandemic. That includes Dallas’ housing market, which is hot in a really strange way. One real estate agent describes the situation as “a near frenzy.” Another calls it simply “weird.”

Back in early March, it was neither. It was normal. Houses were selling at a brisk pace. The market wasn’t as hot as it was in, say, 2016, but sellers were still making a buck and buyers had to work to find a deal. Then the coronavirus arrived.

Read more...We Are Living in the Weirdest Real Estate Market Ever via D Magazine

Tuesday, September 22, 2020

Top Texas Metros for Multifamily Development in 2020 via Multi-Housing News Online

The Texas job market performed strongly before the onset of the pandemic, with all three of its major markets showing up across rankings related to economic and demographic development. This created substantial demand for apartments, pressuring developers to keep up. Land availability, a friendly business climate, good weather and a high quality of life, all contributed to the rapid expansion of the state’s rental market.

Read more...Top Texas Metros for Multifamily Development in 2020 via Multi-Housing News Online

The Strain on Apartment Renters Intensifies as Pandemic Wears On via GlobeSt

The strain on apartment renters is increasing as the pandemic continues. Research from Apartment List found that more than 30% of apartment renters in the US owed back rent payment in September. The number was nearly unchanged compared from August. About half of renters owe less than $1,000 and only 5% owe more than $2,000; however, the report suggests that another round of stimulus checks would be helpful if not necessary to help renters settled these debts and to help landlords recoup losses.

Read more...The Strain on Apartment Renters Intensifies as Pandemic Wears On via GlobeSt

Freddie Mac Multifamily Index Turns Negative via GlobeSt

The Freddie Mac Multifamily Apartment Investment Market Index fell by 0.3% in the second quarter, after posting a quarterly increase of 1.8% in the first quarter of 2020. NOI also fell, by 1.2%, marking the first time in index history where AIMI and NOI were negative together in the second quarter.

AIMI combines multifamily rental income growth, property price growth and mortgage rates to provide a single index that measures multifamily market investment conditions.

Read more...Freddie Mac Multifamily Index Turns Negative via GlobeSt

Adjustments in Pricing Lag a Decline in Property Values via NREI

One thing that buyers and sellers can agree on these days is that there has been a reset in property values across many sectors and geographic markets. Yet the sticking point that continues to stall transactions is determining exactly how much of a discount should be applied.

Pricing is relatively transparent when the market is gliding along with stable conditions, which makes it which makes it easy to gauge values.

Read more...Adjustments in Pricing Lag a Decline in Property Values via NREI

Monday, September 21, 2020

Lenders Appetite for Commercial Property Debt Dwindles via GlobeSt

Commercial property activity has declined substantially this year, but it isn’t for lack of demand. Cash equity seeking commercial property deals is at an all-time high, according to data from Reonomy. At the close of 2019, there was $147 billion in cash equity available for commercial property acquisitions, and in the first half of 2020, nearly $24 billion had been raised. However, lender appetite for commercial property debt has dwindled, and the lack of debt financing had impacted commercial property investment.

Read more...Lenders Appetite for Commercial Property Debt Dwindles via GlobeSt

Apartment Tenants Are Transitioning to Short-Term Leases via GlobeSt

Apartment tenants with pending renewals are beginning to opting for short-term or month-to-month leases rather than long-term leases, according to the latest survey from the National Apartment Association, which found that nearly 35% of landlords said that some portion of tenants renewing leases signing short-term lease structures. The previous monthly report—this latest survey was conducted from July 20 through July 24—did not address short-term lease structure, however, the data notes that tenants’ preference for short-term leases has been increasing since March.

Read more...Apartment Tenants Are Transitioning to Short-Term Leases via GlobeSt

Texas unemployment fell to 6.8% in August as state added 106,800 jobs via Dallas Morning News

Texas' unemployment rate fell again in August to 6.8% as the state added 106,800 jobs over the month, according to new data from the Texas Workforce Commission.

The state unemployment rate for August is below the seasonally adjusted national unemployment rate of 8.4%. In July, Texas' unemployment rate was 8%.

Read more...Texas unemployment fell to 6.8% in August as state added 106,800 jobs via Dallas Morning News

Friday, September 18, 2020

Yardi: Multifamily Rents See Second Consecutive Month of Growth via Multifamily Executive Magazine

U.S. average rent growth saw a second consecutive month of continued growth in August, creeping up by an average of $1 to $1,463. However, on a year-over-year basis, rents decreased 0.3% in August, unchanged from July.

However, with millions of Americans unemployed, it’s still unclear what the remainder of the year will hold for the multifamily industry, according to the latest Yardi Matrix National Multifamily Report.

Read more...Yardi: Multifamily Rents See Second Consecutive Month of Growth via Multifamily Executive Magazine

ALN Monthly Market Stats September 2020 via ALN Apartment Data

ALN Data just released their August 2020 market stats on occupancy and rents for over 80 markets. In Texas, it includes DFW, Austin, Houston, San Antonio, Lubbock, Amarillo, Abilene, Corpus Christi and more. It is a must read from a great provider of apartment data.

Read more...ALN Monthly Market Stats September 2020 via ALN Apartment Data

Thursday, September 17, 2020

Apartment Rent Collections Continue to Decline via GlobeSt

Multifamily fundamentals continue to show signs of distress in the wake of the widespread job and economic losses created by the Coronavirus.

The latest report from the National Multifamily Housing Council’s Rent Payment Tracker, which measures the number of apartment households that make a full or partial rent payment, shows a drop of 2.4%—or 279,457 households—year-over-year, as well as a monthly decline. According to the NMHC Tracker, 86.2% of apartment households made a full or partial rent payment by September 13, compared to 86.9% that paid by August 13 of this year.

Read more...Apartment Rent Collections Continue to Decline via GlobeSt

Tuesday, September 15, 2020

Multifamily Lease Pricing Down As Properties Opt for Shorter-Term Incentives via GlobeSt

Pricing for new apartment leases was down 5% in August from the prior year and lease renewals for under 12 months were on the rise, according to a monthly report on Covid-19’s impact on multifamily housing from MRI Software.

The August drop in new lease pricing continues a trend from July, with properties using shorter-term pricing incentives for leases of less than a year. This shows “good expiration management practices” to protect summer 2021 leases and avoid late-year expirations, said the MRI Software report, which is based on data from its property management software users.

Read more...Multifamily Lease Pricing Down As Properties Opt for Shorter-Term Incentives via GlobeSt

Apartment construction rebounds from pandemic slowdown via Dallas Morning News

Apartment construction activity is bouncing back after declines early in the COVID-19 pandemic.

After big drops in building in April, May and June, nationwide permits for new apartments and multifamily projects saw a surge in July, according to a new report from RealPage.

Read more...Apartment construction rebounds from pandemic slowdown via Dallas Morning News

The flip side of Trump's eviction ban: Landlords face big crunch via Politico

The White House’s move to ban evictions across the country during the coronavirus crisis is having an unintended side effect: It's threatening the livelihood of millions of landlords.

The sweeping order effectively requires landlords to subsidize distressed tenants’ housing through the end of the year or face criminal penalties and hefty fines. That’s a tall order for the country’s 8 million independent landlords — most of whom lease a unit here or there on property they own without the financial backing of professional management companies.

Read more...The flip side of Trump's eviction ban: Landlords face big crunch via Politico

Friday, September 11, 2020

The Pandemic Stifles Rent Growth in Urban Apartments via GlobeSt

Even before COVID-19, apartments in some downtown locations were facing pressure from new supply. Eighty percent of 611,000 units under construction are at the top end of the market, according to CoStar Group.

“I think we’ve been talking about this on the multifamily side for a while,” says CoStar Portfolio Strategy Senior Consultant Juan Arias. “There was going to be a significant supply overhang, specifically in luxury urban multifamily, if a recession came. They were building a lot of apartments. Before the pandemic, we were seeing a sufficient amount of demand coming in, but obviously, all bets are off at this point.”

Read more...The Pandemic Stifles Rent Growth in Urban Apartments via GlobeSt

Wednesday, September 9, 2020

Over 87% of Dallas-Fort Worth apartment renters made their September payments via Dallas Morning News

With the halt in federal unemployment payments, the share of renters who aren’t making their monthly payments has risen significantly.

As of last week, 76.4% of U.S. apartment renters had made their September payments. That’s almost five percentage points less than a year ago and more missed rent payments than earlier in the pandemic.

Read more...Over 87% of Dallas-Fort Worth apartment renters made their September payments via Dallas Morning News

September Rent Payments Reach 76 Percent: NMHC via Multi-Housing News Online

More than 76 percent of U.S. rental households have made rent payments as of Sept. 6, according to the latest report on rent payments from the National Multifamily Housing Council.

The report comes a month after additional $600 a week unemployment benefits expired and about a week after the Trump administration announced a nationwide eviction moratorium through the end of the year.

Read more...September Rent Payments Reach 76 Percent: NMHC via Multi-Housing News Online

Tuesday, September 8, 2020

DFW apartment leasing shows signs of a rebound via Dallas Morning News

Demand for apartments in Dallas-Fort Worth and nationwide plunged this year with the pandemic. But there are signs that the apartment market is bouncing back with a flurry of new leasing.

During the last week of July, new apartment lease signings were up 11% from a year earlier, according to a new report from RealPage.

Read more...D-FW apartment leasing shows signs of a rebound via Dallas Morning News

Houston Economic Indicators September 2020 via Dallas Fed

Indicators for Houston employment, unemployment and manufacturing improved in July. Leading and coincident indexes also showed gains. Higher-frequency data on mobility and engagement point to a tepid end-of-summer recovery from a COVID-19-driven midsummer lull. Taken together, the data suggest that Houston continues to make strides toward economic recovery, but the pace has likely slowed.

Read more... Houston Economic Indicators September 2020 via Dallas Fed

Finance Rates For Small Multifamily Real Estate Find Stability via GlobeSt

The cap rates for small multifamily properties barely budged between the first and second quarters of 2020, according to a new report by Chandan Economics and Arbor Realty Trust.

Cap rates narrowed by 5 bps in the second quarter, landing at 5.8%, explained the article, which was published on lender Arbor Realty Trust’s website.

Read more...Finance Rates For Small Multifamily Real Estate Find Stability via GlobeSt

Friday, September 4, 2020

Austin Economic Indicators September 2020 via Dallas Fed

The Austin economy continued to improve in July. The Austin Business-Cycle Index expanded. Recent payrolls posted healthy gains, and while jobs and the unemployment rate improved in June and July, both remain significantly below their March levels. Regional consumer spending since mid-July held at pre-COVID-19 levels. Existing-home sales remained strong, and building permits rebounded.

Read more...Austin Economic Indicators September 2020 via Dallas Fed

New Lease Signings for Apartments Pick Up in July via RealPage

New lease signings continued to increase across most major apartment markets in July. Some of the gains in leasing activity were due to pent-up demand, as stay-at-home orders due to COVID-19 were lifted. But normal seasonal renting patterns were also at play.

From late March through early May, new lease signings across the nation plummeted as COVID-19 forced most leasing offices to shutter amid shelter-in-place orders.

Read more...New Lease Signings for Apartments Pick Up in July via RealPage

Wednesday, September 2, 2020

Eleventh District Beige Book​ 9/2/20 via Dallas Fed

Increasing COVID-19 infections in the Eleventh District have disrupted the budding economic recovery in some sectors and is the biggest risk to the near-term outlook. While manufacturing activity continued to expand and loan volumes increased in the financial sector, service sector activity declined overall in July but resumed its nascent recovery in August. Retail sales fell steeply in July but stabilized somewhat in August. Energy activity remained depressed. Activity in the housing market was a bright spot, with home sales rising sharply. Employment remained fairly stable, according to contacts. Input costs rose modestly while selling prices were flat to down. Outlooks were increasingly uncertain, with numerous contacts expressing concern over surging COVID-19 cases and the resulting disruption to business.

Read more...Eleventh District Beige Book​ 9/2/20 via Dallas Fed

CDC Declares Eviction Moratorium That Will Last Until Year’s End via GlobeSt

The Centers for Disease Control and Prevention is using its quarantine authority to temporarily halt evictions in order to keep COVID-19 from spreading.

This order will take effect immediately and last until Dec. 31, 2020.

Renters must say they are not able to pay their rent or are likely to become homeless if they are evicted. People earning under $99,000 a year or couples earning less than $198,000 a year are eligible.

Read more...CDC Declares Eviction Moratorium That Will Last Until Year’s End via GlobeSt

Apartment Rent Payments Fall for Third Straight Month via GlobeSt

Apartment rent payments continued their downward drift in August. But the industry’s eyes are focused on September, as states try to fill in the gap from expired unemployment benefits provided by the CARES Act.

The number of households paying rent through August 27 stood at 92.1%, down from 93.3% in July and 94.2% in June, according to the National Multifamily Housing Council’s Rent Payment Tracker. The rate was down 1.9 percentage points year-over-year from August 2019′s 94%.

Read more...Apartment Rent Payments Fall for Third Straight Month via GlobeSt

As Another Month’s Bill Comes Due, Renters at Small Apartment Buildings Struggle via NREI

The vast majority of residents kept paying rent this summer at larger apartment communities–despite the economic crisis caused by the spread of the novel coronavirus. But smaller apartment properties typically do not have professional management companies–they are not included in the data that shows renters are still paying rent. And many renters who live in these building have stopped.

Read more...As Another Month’s Bill Comes Due, Renters at Small Apartment Buildings Struggle via NREI

Tuesday, September 1, 2020

Free rent deals double with the pandemic via Dallas Morning News

Apartment landlords are ramping up the freebies to attract tenants during the pandemic.

The share of rental units offering concessions to tenants has almost doubled since early this year as COVID-19 has swept the country, according to a new study by Zillow.

More than 30% of nationwide rentals are offering some kind of concessions.

Read more...Free rent deals double with the pandemic via Dallas Morning News

Texas Quarterly Apartment Report 2Q2020 via Real Estate Center

Economic activity contracted sharply in second quarter 2020 due to COVID-19 shelter-in-place restrictions, but then rebounded as the economy re-opened during May and June. Putting the health crisis in a historical context, neither the Great Depression nor the Great Recession nor any other recession over the past two centuries caused such a steep, sudden economic decline. The strength and pace of the recovery are unknown because they depend on health outcomes that allow or impede the complete re-opening of the economy. Barring a second wave of the virus and another economic shutdown, 2Q2020 should represent the worst of the economic slump.

Read more...Texas Quarterly Apartment Report 2Q2020 via Real Estate Center

Monday, August 31, 2020

Dallas-Fort Worth Economic Indicators August 2020 via Dallas Fed

The Dallas–Fort Worth economy saw continued signs of a nascent recovery in July, though the pace of growth slowed from June. Payrolls expanded moderately, and the unemployment rate dipped. The housing market was a bright spot, with home sales rising sharply and reaching new highs. Home prices increased moderately, and apartment leasing improved, though rents remained flat.

Read more...Dallas-Fort Worth Economic Indicators August 2020 via Dallas Fed

Pandemic takes toll on Dallas-Fort Worth multifamily market via Dallas Business Journal

Thanks largely to a rebounding jobs market, Dallas-Fort Worth apartment owners are faring better than owners in other parts of the country in the COVID-19 market, Greg Willett, chief economist for RealPage, said in a webinar Thursday.

Even so, it isn’t pretty.

Read more...Pandemic takes toll on Dallas-Fort Worth multifamily market via Dallas Business Journal

Thursday, August 27, 2020

Texas Employment Forecast 8/21/20 via Dallas Fed

Texas job growth fell to 2.5 percent in July after increasing a revised 14.7 percent in June. Private sector jobs fell 1.1 percent. Employment is down 10.4 percent since December 2019. The Texas Leading Index increased for the third consecutive month in July after sharp declines in March and April.

Using a top-down model based on national forecasts, COVID-19 infection rates and oil futures prices, we estimate that Texas jobs will continue to recover in the second half of the year but not enough to fully offset the losses in March and April. The Texas Employment Forecast projects jobs will decline 5.2 percent this year (December/December).

Read more...Texas Employment Forecast 8/21/20 via Dallas Fed

It's Getting Worse. Landlords and Renters Drain Savings to Make Ends Meet Amid Covid-19 via GlobeSt

The struggle to pay rent and meet mortgage payments continues as the COVID-10 pandemic stretches into its sixth month according to a nationwide survey conducted in August 2020 by Avail.

Based on the survey, of the 2,932 renters, the largest group of respondents (31.6%) were between the ages of 30 and 39. And 35.2% (the most common response) of respondents had a total household income ranging from $24,000-$49,999 before taxes last year.

Read more...It's Getting Worse. Landlords and Renters Drain Savings to Make Ends Meet Amid Covid-19 via GlobeSt

Monday, August 24, 2020

Employment Numbers Mask Severity of Labor Market Situation via CPExecutive

Despite the national unemployment rate falling to 10.3 percent and a jobs reports added 1.8 million jobs in July, the labor situation in the United States is more dire than it appears on the surface.

The official unemployment rate fails to capture the 4.5 million workers who have left the labor market since February and have yet to return. Nearly every economic statistic that has been released in recent months has shown severe swings that were previously unprecedented and unfathomable, and the drop in labor force participation is no exception.

Read more...Employment Numbers Mask Severity of Labor Market Situation via CPExecutive

The K-Shaped US Economic Recovery Theory and What It Means for CRE via GlobeSt

An uneven economic recovery from the COVID-19 crash is increasing the divide between the haves and have-nots, and the rift will extend to the commercial real estate market, according to a new report.

The report explores how some economists’ theory that the country will see a “K-shaped” economic recovery might also create an unequal recovery in the office, retail and housing segments of the real estate industry.

Read more...The K-Shaped US Economic Recovery Theory and What It Means for CRE via GlobeSt

Wednesday, August 19, 2020

Millions of Apartment Renters Sit at the Brink of Disaster via NREI

Millions of apartment residents have fallen behind on their rent payments, according to data from the U.S. Census—and the damage is likely to spread as the economic crisis caused by the novel coronavirus continues.

Federal assistance that helped millions of renters stay current on their rents even after they lost their jobs has now expired with little clarity from Washington on whether it will be renewed.

Read more...Millions of Apartment Renters Sit at the Brink of Disaster via NREI

Cloudy Prospects for Multifamily Amid Economic Comeback via Multi-Housing News Online

The U.S. economy is expected to stage a comeback in the third quarter, bolstering a strong residential market, according to new research by Fannie Mae’s Economic & Strategic Research (ESR) Group—but job losses and budget cuts on the state and local level could weigh on multifamily development.

The group now forecasts that domestic GDP will grow by an annualized rate of 27.2 percent during the quarter as the economy continues to reopen. Factoring in the historic decline of the second quarter, GDP is projected to grow by 3.1 percent in 2020.

Read more...Cloudy Prospects for Multifamily Amid Economic Comeback via Multi-Housing News Online

ALN Monthly Market Stats August 2020 via ALN Apartment Data

ALN Data just released their July 2020 market stats on occupancy and rents for over 80 markets. In Texas, it includes DFW, Austin, Houston, San Antonio, Lubbock, Amarillo, Abilene, Corpus Christi and more. It is a must read from a great provider of apartment data.

Read more...ALN Monthly Market Stats August 2020 via ALN Apartment Data

Tuesday, August 18, 2020

DFW ranks fourth for U.S. commercial property investment at 2020 midpoint via Dallas Morning News

The Dallas-Fort Worth area ranked fourth nationally for total real estate investment at midyear.

Property market investment in North Texas totaled about $23 billion for the 12-month period ending in June, according to researchers at CBRE and Real Capital Analytics.

That’s down 7.5% from the previous year because of the COVID-19 pandemic.

But the year-over-year decline in investment in North Texas was tiny compared to the almost 70% drop nationwide for properties such as offices, apartments, hotels, shopping centers and industrial buildings.

Read more...Dallas-Fort Worth ranks fourth for U.S. commercial property investment at 2020 midpoint via Dallas Morning News

COVID-19 Slowdown Cuts Apartment Construction by 12% via GlobeSt

The slow pace of construction, crew shortages and construction bans that came with COVID-19 has cut apartment construction by 12%, according to a new report.

There are 283,000 new apartment units expected to hit the market this year, which is much less than a peak in 2018, said the report by RENTCafe Blog.

The downward trend is beginning to mirror the hit from the 2008 economic recession, according to the article by Florentina Sarac, “Apartment Construction in 2020 at 5-Year Low Nationally, Down 12% from Previous year.”

Read more...COVID-19 Slowdown Cuts Apartment Construction by 12% via GlobeSt

Thursday, August 13, 2020

How to Bolster Apartment NOI During COVID-19 via Multifamily Executive

It’s easy to hit your numbers when times are good.

But for multifamily pros navigating the fallout of COVID-19, 2020 has been about finding ways to maximize net operating income (NOI), even when times are tough.

Read more...How to Bolster Apartment NOI During COVID-19 via Multifamily Executive

COVID Hits Class C Apartments Hard via GlobeSt

So far, the apartment market has held up relatively well after COVID-19. But Jake Reiter, president of Verde Capital, does see some issues on the horizon.

“Maybe multifamily holds up better if it’s not C class,” Reiter says. “But C is not weathering the storm as well because its [renter] demographic is more likely to be unemployed and less likely to be able to make payments.”

Read more...COVID Hits Class C Apartments Hard via GlobeSt

Texas homeownership hits record high via Dallas Morning News

A summer surge in buying has pushed Texas’ homeownership rate to the highest level on record.

As of June, 67.5% of Texans owned their homes, according to a new report from the Real Estate Center at Texas A&M University.

In Dallas-Fort Worth, the homeownership rate rose to 64.7% at midyear.

Read more...Texas homeownership hits record high via Dallas Morning News

Wednesday, August 12, 2020

COVID-19 Downturn Fuels Q2 Falloff in Multifamily Demand via Multi-Housing News Online

The second quarter is usually strongest in demand for multifamily housing. But that was not the case this year, when net absorption plummeted to the lowest Q2 level in 11 years, only 21,100 units. This was among the findings of CBRE’s Multifamily Figures Report for Q2 2020, which termed the COVID-19 economic malaise a drag on apartment demand.

The fact net absorption in the quarter was positive indicated the multifamily market fared better than some anticipated, given headwinds exerted by the pandemic and the faltering economy, CBRE reported. Key to that performance were stimulus programs at the state and federal level, which assisted apartment residents in affording their rents. CBRE added net absorption is anticipated to trend negative for the remainder of this year.

Read more...COVID-19 Downturn Fuels Q2 Falloff in Multifamily Demand via Multi-Housing News Online

Austin Economic Indicators August 2020 via Dallas Fed

The Austin economy showed signs of improvement in June following the impact of COVID-19. The Austin Business-Cycle Index surged. While employment and the unemployment rate improved in June from May, both remain significantly below their February levels. Consumer spending has improved considerably since mid-April in Travis County. While existing-home sales increased sharply in June, building permits declined.

Read more...Austin Economic Indicators August 2020 via Dallas Fed

Texas Economy’s Rebound Stalls in July after Gains in May, June via Dallas Fed

The resurgence of COVID-19 in July appears to have reversed economic gains in Texas that emerged when the virus’ frequency abated in May and June. Employment and other activity had increased strongly from April lows during initial pandemic disruptions in the state.

As a result, the Texas Employment Forecast suggests that on net the number of jobs will decline 4.8 percent this year on a December-over-December basis.

Texas employment improved in June—though more slowly than May’s pace—after historic contractions in April. The state recovered about 522,000 jobs in May and June, about 40 percent of the 1.3 million jobs lost during March and April.

Read more... Texas Economy’s Rebound Stalls in July after Gains in May, June via Dallas Fed

Monthly rental payments continue to lag via Dallas Morning News

Less than 80% of U.S. apartment residents had made their August rent payments as of last week.

That’s a decline from a year ago but is about the same as this time in July, according to the latest update from the National Multifamily Housing Council.

The Washington, D.C.-based apartment industry trade group tracks 11.4 million professionally managed rental units for its monthly nationwide survey.

Read more...Monthly rental payments continue to lag via Dallas Morning News

Thursday, July 30, 2020

Houston Economic Indicators July 2020 via Dallas Fed

Pandemic-induced declines in economic activity for Houston slowed in May as the economy reopened, and some signs of recovery began. Leading and coincident indexes logged modest improvements, but Houston’s energy sector continued to shed jobs ahead of record-setting lows for drilling activity in the U.S. in June. Unfortunately, June also saw a return to sharp growth in COVID-19 hospitalizations. This increase has put a damper on the recovery as policy efforts to contain the virus and voluntary social distancing likely contributed to a reduction in area mobility and engagement.

Read more... Houston Economic Indicators July 2020 via Dallas Fed

Dallas-Fort Worth Economic Indicators July 2020 via Dallas Fed

The Dallas–Fort Worth economy saw further signs of a fledgling recovery in June. Payrolls expanded strongly, and the unemployment rate fell. However, high-frequency data point to a slowing in DFW economic activity since late June that is synchronous with rising new COVID-19 cases and hospitalizations. Apartment and office leasing activity was sluggish in the second quarter due to weak demand, while industrial leasing remained solid.

Read more...Dallas-Fort Worth Economic Indicators July 2020 via Dallas Fed

Tuesday, July 21, 2020

DFW still leads U.S. in apartment leasing via Dallas News

The COVID-19 pandemic fueled a plunge in second-quarter apartment leasing in North Texas, but Dallas-Fort Worth still topped the country in total apartment leasing at midyear.

D-FW net apartment leasing totaled only 3,832 units in the just-completed quarter — down from almost 13,000 units a year earlier, according to RealPage.

But that was enough to keep North Texas at the head of the list of the country’s fastest-growing apartment rental markets.

Read more...D-FW still leads U.S. in apartment leasing via Dallas Morning News

Thursday, July 16, 2020

ALN Monthly Market Stats July 2020 via ALN Apartment Data

ALN Data just released their June 2020 market stats on occupancy and rents for over 80 markets. In Texas, it includes DFW, Austin, Houston, San Antonio, Lubbock, Amarillo, Abilene, Corpus Christi and more. It is a must read from a great provider of apartment data.

Read more...ALN Monthly Market Stats July 2020 via ALN Apartment Data

Wednesday, July 15, 2020

Eleventh District Beige Book​ 7/15/20 via Dallas Fed

The Eleventh District economy regained its footing following unprecedented declines in the previous two reporting periods. Activity in the manufacturing and service sectors began rebounding, as did retail spending. However, the level of output and demand remained below pre-COVID levels. Loan volumes contracted at a modest pace, and drilling activity fell to new lows. Activity in the housing market expanded, with new home sales outperforming activity in the existing-home market. Employment stabilized, according to contacts, but overall labor market conditions remained weak. Wages were flat to slightly up. While input costs rose modestly, selling prices generally dipped further. Outlooks improved, but a weak economy, depressed activity in the energy sector, the resurgence of COVID-19 infections, and a pause in the reopening of the district economy were causing concern among contacts.

Read more...Eleventh District Beige Book​ 7/15/20 via Dallas Fed

Monday, July 6, 2020

Austin Economic Indicators July 2020 via Dallas Fed

The Austin economy continued to contract in May due to the impact of COVID-19. The Austin Business-Cycle Index continued to decline. While jobs and the unemployment rate improved in May, both remain significantly worse than in February. Consumer spending improved significantly from mid-April to mid-June in Travis County. Existing-home sales declined further in May, while building permits held steady.

Read more...Austin Economic Indicators July 2020 - Dallas Fed

Thursday, July 2, 2020

Dallas-Fort Worth Economic Indicators June 2020 via Dallas Fed

The Dallas–Fort Worth economy showed some signs of recovery in May following epic declines in April. The unemployment rate dipped and payrolls rebounded, although employment stayed significantly below levels seen in February, before COVID-19 measures took effect. Initial jobless claims continued to be elevated in mid-June, though they have come down from the highs seen in late March and early April. Movements in the Dallas and Fort Worth business-cycle indexes were mixed in May. Home sales slumped again across most price points, though inventories remained tight. Apartment leasing remained sluggish in May.

Read more...Dallas-Fort Worth Economic Indicators June 2020 via Dallas Fed

Texas Service Sector Outlook Survey June 2020 via Dallas Fed

Following three months of steep decline, the Texas service sector showed signs of growth in June, according to business executives responding to the Texas Service Sector Outlook Survey. The revenue index, a key measure of state service sector conditions, rebounded to positive territory, advancing from -28.1 in May to 5.7 in June.

Labor market indicators reflected mostly stable employment and workweek length in June. The employment index rose over eight points to -1.9, suggesting little net change in jobs compared with May. The hours worked index ticked up over nine points to -0.2.

Read more...Texas Service Sector Outlook Survey June 2020 via Dallas Fed

Texas Manufacturing Outlook Survey June 2020 via Dallas Fed

Texas factory activity rebounded strongly in June, according to business executives responding to the Texas Manufacturing Outlook Survey. The production index, a key measure of state manufacturing conditions, climbed from -28.0 to 13.6, indicating moderate expansion in output following three months of record or near-record declines.

Other measures of manufacturing activity also pointed to a rebound in growth this month.

Read more...Texas Manufacturing Outlook Survey June 2020 via Dallas Fed

Wednesday, July 1, 2020

A Hard Time for Homebuyers Might Be a Boon for Multifamily via Multi-Housing News

Landlords may be able to keep their residents longer than they might have prior to the COVID-19 pandemic, according to a new report.

A report from Realtor.com, the National Association of Realtors listing site, says renters who had to dip into their savings to cover their everyday expenses during the scourge are highly likely to delay purchasing a house.

Read more...A Hard Time for Homebuyers Might Be a Boon for Multifamily via Multi-Housing News

Freddie Mac Augments Multifamily Forbearance Program via Multi-Housing News Online

Freddie Mac Multifamily has expanded its COVID-19 forbearance program, creating supplemental forbearance relief options for landlords who are still facing economic hardship. The new changes also extend several protections for renters including a ban on evictions solely for nonpayment of rent, which was a feature of the original program when it was rolled out in March.

The mortgage relief options are geared towards borrowers who need further assistance as they may be approaching the end of the 90-day forbearance period granted in the first iteration of the program.

Read more...Freddie Mac Augments Multifamily Forbearance Program via Multi-Housing News Online

Texas Multifamily Owners File Lawsuit Against CARES Act Eviction Moratorium via Bisnow

Two small multifamily owners in Texas have filed a lawsuit against the U.S. government, challenging the legality of a moratorium on certain eviction proceedings under the Coronavirus Aid, Relief and Economic Security Act.

The lawsuit, filed in the U.S. District Court, Northern District of Texas, Fort Worth Division on June 24, is seeking a declaratory judgment that Section 4024 of the CARES Act cannot be legally enforced.

Read more...Texas Multifamily Owners File Lawsuit Against CARES Act Eviction Moratorium via Bisnow

Tuesday, June 30, 2020

Multifamily Remains Strong Amid Health And Economic Uncertainty via Forbes

As cities and businesses begin to reopen following weeks or months of stay-at-home orders, many sectors of the economy face the reality of a downturn. Amid that climate of uncertainty, multifamily remains strong as an investment opportunity.

Multifamily real estate has a long history of weathering economic storms. Last year, CBRE analyzed the effects of the past two recessions on the commercial real estate market and found that “multifamily outperformed office and industrial in the 2001 recession and all major property sectors (office, industrial, retail) during the 2008-2009 recession. Multifamily generally had lower total rent decline and more rapid post-recession rent recovery.”

Read more...Multifamily Remains Strong Amid Health And Economic Uncertainty via Forbes

Wednesday, June 24, 2020

What Rent Collection Data Is Really Telling You via GlobeSt

These days, rent collection data is among the most highly reviewed monthly reports. However, the strength of rent payments during the pandemic really depends on what outlet you’re reading. For June, Lease Lock has reported rents are down 6% compared to pre-COVID levels; the National Multifamily Housing Council is reporting that June rents are on par with 2019 collections to date; and Apartment List reports that 30% of tenants are not able to make a complete rent payment.

The inconsistencies come down to two factors:

Read more...What Rent Collection Data Is Really Telling You via GlobeSt

NMHC Rent Payment Tracker JUNE 1-20, 2020 via NMHC

The National Multifamily Housing Council (NMHC)’s Rent Payment Tracker found 92.2 percent of apartment households made a full or partial rent payment by June 20 in its survey of 11.4 million units of professionally managed apartment units across the country.

This is unchanged from the share who paid rent through June 20, 2019 and compares to 90.8 percent that had paid by May 20, 2020. These data encompass a wide variety of market-rate rental properties across the United States, which can vary by size, type and average rental price.

Read more...NMHC Rent Payment Tracker JUNE 1-20, 2020 via National Multifamily Housing Council

Monday, June 22, 2020

Texas apartment markets will slowly rebound via Dallas Morning News

Texas apartment markets have suffered setbacks due to the COVID-19 pandemic.

But the rental business is expected to recover over the next 18 months as the impact of the coronavirus subsides, according to a new forecast from CBRE.

Researchers with the commercial real estate firm looked at major apartment markets across the state.

Read more...Texas apartment markets will slowly rebound via Dallas Morning News

Thursday, June 18, 2020

ALN Monthly Market Stats June 2020 via ALN Apartment Data

ALN Data just released their May 2020 market stats on occupancy and rents for over 80 markets. In Texas, it includes DFW, Austin, Houston, San Antonio, Lubbock, Amarillo, Abilene, Corpus Christi and more. It is a must read from a great provider of apartment data.

Read more...ALN Monthly Market Stats June 2020 via ALN Apartment Data

Tuesday, June 16, 2020

Rent Payments Reach 89 Percent via Multi-Housing News Online

Rental payments in the U.S. hit 89 percent as of June 13, a jump of more than 8 percent from the previous week, according to the latest report from the National Multifamily Housing Council.

By comparison, during the same time period last year, 88 percent of renters paid full or partial rent payments by June 13, 2019. The figure is a 1.3 percent increase from the share of rental payments tracked during the same time period last month.

Read more...Rent Payments Reach 89 Percent via Multi-Housing News Online

Thursday, June 11, 2020

When Benefits Run Out, What Happens to Rent Relief? via Multi-Housing News Online

As multifamily owners and landlord groups wait on the Senate to pass more rent relief legislation for those financially impacted by the ongoing coronavirus pandemic, some cities and states have wasted no time launching their own relief efforts to help renters make ends meet.

But with the extra $600 in weekly unemployment benefits for eligible individuals poised to run out soon, many in the industry are worried that more support may not come soon enough to prevent big problems for landlords and renters alike.

Read more...When Benefits Run Out, What Happens to Rent Relief? via Multi-Housing News Online

Is It Time To Buy A Multifamily Investment Property? via Forbes

Yes, now is the time. We were already moving into a recession at the beginning of 2020. Multifamily has historically been a very good investment during a recession. Now, with the pandemic creating volatility in office, retail, industrial and other sectors, the capital usually directed toward those investments will most likely seek the stability and predictability of multifamily. But it has not happened yet. Everyone’s too shell-shocked. This creates a perfect window to buy.

Read more...Is It Time To Buy A Multifamily Investment Property? via Forbes

Wednesday, June 10, 2020

Most apartment renters keeping up with payments via Dallas Morning News

More renters are falling behind in their payments due to the pandemic.

About 19% of apartment renters nationwide hadn’t made this month’s payment as of June 6, according to the latest data from the National Multifamily Housing Council, which represents major apartment landlords.

Read more...Most apartment renters keeping up with payments via Dallas Morning News

Tuesday, June 9, 2020

NMHC Rent Payment Tracker June 1-6, 2020 via National Multifamily Housing Council

The National Multifamily Housing Council (NMHC)’s Rent Payment Tracker found 80.8 percent of apartment households made a full or partial rent payment by June 6 in its survey of 11.5 million units of professionally managed apartment units across the country.

This is a 0.7-percentage point decrease in the share who paid rent through June 6, 2019 and compares to 80.2 percent that had paid by May 6, 2020. These data encompass a wide variety of professionally managed market-rate rental properties across the United States, which can vary by size, type and average rental price.

Read more...NMHC Rent Payment Tracker June 1-6, 2020 via National Multifamily Housing Council

Apartment New Lease Signings Surge in Late May via RealPage

U.S. market-rate apartments signed more new leases in May 2020 compared to May 2019, fueled by a surge in leasing activity over the second half of the month. The results are remarkable given a backdrop of double-digit unemployment and tens of millions of job losses.

Read more...Apartment New Lease Signings Surge in Late May via RealPage

Monday, June 8, 2020

Austin Economic Indicators May 2020 via Dallas Fed

The Austin economy slowed in March as the impacts of the coronavirus (COVID-19) began to surface. The Austin Business-Cycle Index grew well below trend. Jobs declined, the unemployment rate increased and initial unemployment claims surged. Real estate activity in the metro slowed, home sales prices increased and building permits fell.

Read more...Austin Economic Indicators May 2020 - Dallas Fed

Report: Turnover Drops to Levels Not Seen In Decades via GlobeSt

A commercial real estate services company is reporting seeing that landlords of multifamily property are seeing turnover fall to the lower levels in more than 20 years.

According to a report by CBRE, turnover, which is the percentage of total rented units that are not renewed each year, fell from 47.5 % in 2019 to 42.1 % in April. The report attributes the decline to historical trends that have been exacerbated due to the coronavirus pandemic.

Read more...Report: Turnover Drops to Levels Not Seen In Decades via GlobeSt

Houston Economic Indicators June 2020 via Dallas Fed

The Houston economy declined at a dramatic pace in April as the impact of COVID-19 and efforts to contain it swept through the region. While employment and unemployment showed record-breaking deterioration, there are already some early signs of economic recovery. Daily measures for mobility and engagement and the number of hourly employees working at small firms show that Houstonians are beginning to leave home and return to work. Taken together, the data imply that declines in the economy were slowing in May. A protracted recovery and a great deal of uncertainty remain ahead.

Read more... Houston Economic Indicators June 2020 via Dallas Fed

Hotel, Retail Lead Late Loans—Will Other Assets Follow? via CPExecutive

The number of commercial mortgages in arrears continued to grow in May, with problems concentrated in hotels and retail centers. Although delinquencies remain low in other property types, signs of stress are beginning to appear.

The percentage of delinquent CMBS loans rose in May to 7.4 percent, and the rate has more than tripled from 2.3 percent in December 2019, according to Trepp.

Read more...Hotel, Retail Lead Late Loans—Will Other Assets Follow? via CPExecutive

Dallas-Fort Worth Economic Indicators May 2020 via Dallas Fed

The DFW economy contracted at an unprecedented pace in April due to the ongoing economic distress caused by the COVID-19 pandemic. Payroll employment saw its steepest decline on record, and unemployment spiked to a historical high as business closures led to layoffs spanning most industries. The Dallas and Fort Worth business-cycle indexes—broad measures of economic activity in the metro area—slumped further. Single-family permits fell for the second month in a row, and apartment absorption slowed notably in April relative to year-ago levels.

Read more...Dallas-Fort Worth Economic Indicators May 2020 via Dallas Fed

Dallas-Fort Worth construction starts plunged as COVID-19 spread via Dallas Morning News

Dallas-Fort Worth building starts took a dive in April as the COVID-19 pandemic took hold.

Nonresidential building starts plunged by more than 40% from a year ago, according to a new report from Dodge Data & Analytics.

Residential building activity was also down 14% year-over-year in April as the coronavirus shut down the economy.

Read more...Dallas-Fort Worth construction starts plunged as COVID-19 spread via Dallas Morning News

Apartment Rent Payments Begin to Waver in Early June via GlobeSt

Apartment rent payments started to waver in early June, illustrating signs of growing economic disruption. April and May rent payments fell nominally—by about 4% for first-of-the-month payments—held up by landlord rent deferral programs and government assistance. In June, first-of-the-month payments fell another 2%, a 6% decrease compared to pre-COVID rent collections, according to research from LeaseLock.

Read more...Apartment Rent Payments Begin to Waver in Early June via GlobeSt

Wednesday, June 3, 2020

Distress Investors May Have to Wait as Long as 3 Years for Non-performing Loans to Come to Market via GlobeSt

Distress investors have been racing to the market in anticipation of snapping up deals. For the most part they are finding, to some chagrin, that there are little properties and loans available at deep discounts. There has been much positing about when these transactions will come to market—the end of summer and the fourth quarter are two popular timelines—but a better question might be to ask, why are there no distress deals available now? That answer in turn becomes a straight line to the question of when.

Read more...Distress Investors May Have to Wait as Long as 3 Years for Non-performing Loans to Come to Market via GlobeSt

Wednesday, May 27, 2020

Eleventh District Beige Book 5/27/2020 via Dallas Fed

Eleventh District economic activity contracted sharply in April, while preliminary data from May point to a notable easing in the pace of decline as restrictions on businesses were gradually lifted. Activity in the energy and service sectors remained the hardest hit. Manufacturing output and new orders fell further, though food manufacturing continued to increase. Loan volumes contracted broadly, with the exception of residential mortgages and SBA's PPP funds. Home sales fell sharply from mid-March through mid-April but have been improving from low levels since then. Employment and hours worked continued to plummet, pressuring wages. While input costs were flat to slightly up, food processors noted a large increase in meat prices. Selling prices dipped further. Preliminary results from a May Dallas Fed Survey of Texas manufacturing and service firms indicated that current revenue levels for most respondents were down markedly compared with a typical May, and about a fifth said they would not be able to survive past six months if revenues did not improve. Outlooks remained weak due to uncertainty surrounding the pace and scope of the reopening of the District economy.

Read more...Eleventh District Beige Book 5/27/2020 via Dallas Fed

Tuesday, May 26, 2020

May Rent Payments Hit 91 Percent via Multi-Housing News Online

Three weeks into May, 90.8 percent of rental households have made full or partial rent payments, according to just-released data from the National Multifamily Housing Council.

By comparison, by the same time last month, 89.2 percent of renters had made a payment, while 93 percent of rental households had made a payment through the same time period last year.

Read more...May Rent Payments Hit 91 Percent via Multi-Housing News Online

Coronavirus Dents Multifamily Development via Multi-Housing News Online

This was supposed to be a year marked by a healthy amount of new multifamily supply, as some 300,000 units were on pace to open by the end of 2020. But federal, state and local stay-at-home orders and other responses to the coronavirus pandemic will likely reduce that to around 250,000 units, according to projections by commercial real estate brokerage Marcus & Millichap and REIS, the property research arm of Moody’s Analytics.

Read more...Coronavirus Dents Multifamily Development via Multi-Housing News Online

CRE Economists Think Current Recession Won't Be as Bad as the 2008 Crisis via GlobeSt

Nearly 40 real estate economists and analysts feel the COVID-19 recession will impact real estate markets and values less severely than the 2008 financial crisis—except for retail and hotel real estate.

The economists predicted there will be a $275 billion decrease in real estate transaction volumes in 2020, according to a survey in May by the Urban Land Institute. But they expected transaction volumes to rise over the next two years, which would create a healthier capital market compared to the 2008 Great Recession.

Read more...CRE Economists Think Current Recession Won't Be as Bad as the 2008 Crisis via GlobeSt

Wednesday, May 20, 2020

Why Multifamily Rents are Holding Up Better than Expected via NREI

Despite mass unemployment and underemployment, multifamily rental payments have held up far better than many industry experts expected amid the economic wreckage caused by the spread of the novel coronavirus.

More than 36 million people have filed for unemployment in recent weeks and millions of others working fewer hours and taking reduced pay. That’s amid new estimates that real GDP growth for the second quarter will come in at -42.8 percent. Toss in a backdrop in which, as of December, 69 percent of Americans had less than $1,000 in savings accounts, and it would seem to paint a bleak picture on the ability of renters to meet their obligations.

Read more...Why Multifamily Rents are Holding Up Better than Expected via NREI

Tuesday, May 19, 2020

What Lenders Look for in New Loans: Q&A via Multi-Housing News Online

Pandemic-fueled uneasiness has forced lenders to realign underwriting strategies. Anthony Delfre, managing director of the Real Estate Advisors Group at Brown Gibbons Lang & Co., spoke to Multi-Housing News about the multifamily debt market amid the lingering global health crisis. What deals are lenders focusing on and who is still active in the mortgage industry?

Read more...What Lenders Look for in New Loans: Q&A via Multi-Housing News Online

Monday, May 18, 2020

Almost 88% of renters nationwide have made their May payments via Dallas Morning News

Apartment renters are continuing to make their monthly payments in the face of the pandemic.

Almost 88% of renters nationwide had made their May rents as of this week, according to the latest report from the National Multifamily Housing Council.

Read more...Almost 88% of renters nationwide have made their May payments via Dallas Morning News

Multifamily Loan Maturities Expected to Rise as Net Operating Incomes Drop via GlobeSt

Maturities for multifamily loans will be up this year by double-digits during the disruption of capital markets by the COVID-19 pandemic, according to a new report from CBRE.

The rise in multifamily maturities—up 11.9% to $72.9 billion in the main lender categories—is expected, writes report author Jeanette Rice, CBRE’s head of multifamily research for the Americas. It’s part of “a new ‘wall of maturities’ that is building for the 2022-2026 period.”

Read more...Multifamily Loan Maturities Expected to Rise as Net Operating Incomes Drop via GlobeSt

ALN Monthly Market Stats May 2020 via ALN Apartment Data

ALN Data just released their April 2020 market stats on occupancy and rents for over 80 markets. In Texas, it includes DFW, Austin, Houston, San Antonio, Lubbock, Amarillo, Abilene, Corpus Christi and more. It is a must read from a great provider of apartment data.

Read more...ALN Monthly Market Stats May 2020 via ALN Apartment Data

Tuesday, May 12, 2020

Waiting Out Multifamily Opportunities in the Aftermath via GlobeSt

Like nearly every industry, the multifamily real estate market has taken a hit during the COVID-19 pandemic, but it may have one advantage that some industries don’t. People always need a place to live, especially during stay at home orders.

For investors or potential investors in multifamily real estate, that means waiting for opportune moments to arise once the worst of the crisis has passed.

Read more...Waiting Out Multifamily Opportunities in the Aftermath via GlobeSt

Friday, May 8, 2020

Most DFW apartment residents are still paying rent via Dallas Morning News

More than 80% of America’s apartment renters have made their May payments. And in the Dallas-Fort Worth area, about 87% of apartment residents so far have paid their rent for the month.

That’s better than some forecasters had expected in a month with record unemployment and pay cuts caused by the pandemic.

Read more...Most DFW apartment residents are still paying rent via Dallas Morning News

Thursday, May 7, 2020

What Historic Unemployment Could Mean for Multifamily via Multi-Housing News Online

Jobless claims in the U.S. have hit record levels since nationwide stay-at-home-orders went into effect and businesses shut their doors in mid-March. As the Bureau of Labor Statistics prepares to release its monthly report on employment figures, multifamily leaders and experts discussed what the numbers could mean for the industry.

Read more...What Historic Unemployment Could Mean for Multifamily via Multi-Housing News Online

Texas Economic Activity Sharply Falls in Wake of COVID-19 via Dallas Fed

Economic distress caused by the COVID-19 pandemic has sent the Texas economy into a tailspin. Virus containment measures have prompted unprecedented declines in demand and triggered mass layoffs, shaking business and consumer confidence.

Activity in the service sector has been more severely affected than in manufacturing, precipitating downward pressures on wages and prices. The state’s oil and gas sector has been decimated. The housing market has slowed, too, as sellers and buyers take a wait-and-see approach.

Read more...Texas Economic Activity Sharply Falls in Wake of COVID-19 via Dallas Fed

Wednesday, May 6, 2020

What $100B in Rent Relief Could Look Like When it Hits the Market via GlobeSt

On Monday Sen. Sherrod Brown (D-Ohio) tweeted the news that he was planning to introduce a $100 billion rent relief bill, surprising many in the industry that had begun to wonder if the federal government had forgotten about them.

Even with the tweet, Washington observers could have been forgiven for feeling jaded about the measure’s prospects: Republicans and Democrats are at odds on what future federal assistance will look like while President Trump has his own ideas about what the next steps should be.

Read more...What $100B in Rent Relief Could Look Like When it Hits the Market via GlobeSt

Tuesday, May 5, 2020

Senator to Introduce $100B Emergency Rental Assistance Bill via GlobeSt

To date, the multifamily industry has received little assistance from Washington, DC, even as 30 million people have been thrown into unemployment over the last six weeks. While the majority of renters paid their April rents, it is widely believed that fewer will be able to meet their monthly rent obligation for May.

A bill that will be introduced in the Senate could provide relief to both tenants and their landlords.

Read more...Senator to Introduce $100B Emergency Rental Assistance Bill via GlobeSt

Suddenly Apartment Landlords Have Become the Enemy via GlobeSt

So many renters are scared these days. May 1 has come and gone and it is expected that a significant number were not able to come up with the money for their rent. Without a doubt, their stories are heartbreaking: Families that have lost their jobs, have little savings as fallback and in some cases are terrified they won’t be able to feed and properly house and educate their children.

Some renters, though, are also angry and on the first of the month they demonstrated that anger by participating in a rent strike held across several cities in the US. A quick perusal on Twitter (#rentstrike and #cancelrent will do the trick) illustrates just how much ill will these renters hold towards their landlords.

Read more...Suddenly Apartment Landlords Have Become the Enemy via GlobeSt

Friday, May 1, 2020

Weekly New Apartment Lease Signings Match 2019 Levels, While Rents Decline via RealPage

We continue to monitor daily leasing activity for the U.S. apartment market, and the most recent numbers were a shocker: Last week, executed new lease volumes came in nearly on par with the 2019 totals for the same period, based on analysis of RealPage’s rent roll data.

The results marked a continued upward trend in traffic and leasing activity since bottoming in late March, when total lease new signings were down nearly 50% year-over-year. As of April 26, total new lease signings over the trailing seven days were down only 1.6%.

Read more...Weekly New Apartment Lease Signings Match 2019 Levels, While Rents Decline via RealPage

More Apartment Residents Say They Can’t Pay Rent for May via GlobeSt

There is little doubt that apartment renters are hurting from the coronavirus, according to a new survey by Grace Hill, a software company that surveys the multifamily industry.

It found that Covid-19-related related income losses have impacted nearly two-thirds, or 63%, of all renters surveyed. Furthermore 52% indicated they would be able to pay the May rent in full, compared to 69% who said they paid April’s rent in full.

Read more...More Apartment Residents Say They Can’t Pay Rent for May via GlobeSt

COVID-19 Shutdowns Impacted CRE Markets Right Away via Nareit

The business closures and social distancing designed to slow the spread of COVID-19 did not take affect until the final few weeks of the first quarter, but they had a significant impact on demand for commercial real estate, vacancies and rent growth across the major property sectors.

Newly-released data from CoStar show that net absorption of apartments was 65,000 units in the first quarter, the weakest start to a year since 2014 (chart 1 shows four-quarter sums due to seasonal patterns in demand, in dark blue bars. Completions, or new supply, are shown with the sign reversed in the light blue bars). There has been a high level of construction of new apartments, which leaves this sector particularly exposed to slowing demand.

Read more...COVID-19 Shutdowns Impacted CRE Markets Right Away via Nareit

Thursday, April 30, 2020

Houston Economic Indicators April 2020 via Dallas Fed

Data for March in Houston have begun to show the effects of efforts to contain the coronavirus (COVID-19) pandemic. Employment contracted, the business-cycle index slowed, leading indicators were broadly negative, and the unemployment rate rose sharply for March. Weekly initial claims for unemployment insurance in April remained elevated. Existing-home sales contracted but remain at a healthy level. Taken together, the data paint a sobering picture of further declines ahead.

Read more... Houston Economic Indicators April 2020 via Dallas Fed

While Resilient, Multifamily is Not Immune to COVID-19 via GlobeSt

COVID-19 has wreaked havoc on many commercial real estate segments. While the multifamily sector is a resilient one, it is not immune to the wrath of this global pandemic.

But despite the many challenges, there are some positive signs that support the ongoing resilience of the multifamily sector during this health crisis, says Zain Jaffer, founder and CEO of Zain Ventures. There are opportunities facing economic subsectors and the market as a whole along with key factors that will determine the severity of the pandemic’s impact on the sector.

Read more...While Resilient, Multifamily is Not Immune to COVID-19 via GlobeSt

Wednesday, April 29, 2020

Dallas-Fort Worth Economic Indicators April 2020 via Dallas Fed

The Dallas–Fort Worth economy contracted in March. Payroll employment posted its largest drop since the series began in 1990, and unemployment rose as containment measures related to the COVID-19 pandemic triggered mass layoffs, particularly in the leisure and hospitality sector. The Dallas and Fort Worth business-cycle indexes fell. Home sales dipped in March, and pending home sales, a forward-looking indicator, fell as well. Office leasing activity softened in the first quarter.

Read more...Dallas-Fort Worth Economic Indicators April 2020 via Dallas Fed

DFW apartment demand bounces back via Dallas Morning News

So far, North Texas’ apartment market has shrugged off the worst impacts of the COVID-19 pandemic.

Leasing activity in the Dallas-Fort Worth area is up from a year ago, according to a survey last week by Richardson-based RealPage.

“Apartment leasing activity is suddenly back in a big way, at least for the moment,” RealPage chief economist Greg Willett said. “U.S. apartment leasing activity is roughly back to year-ago levels, after demand dropped drastically in late March to early April.”

Read more...DFW apartment demand bounces back via Dallas Morning News

More Apartment Residents Say They Can’t Pay Rent for May via GlobeSt

There is little doubt that apartment renters are hurting from the coronavirus, according to a new survey by Grace Hill, a software company that surveys the multifamily industry.

It found that Covid-19-related related income losses have impacted nearly two-thirds, or 63%, of all renters surveyed. Furthermore 52% indicated they would be able to pay the May rent in full, compared to 69% who said they paid April’s rent in full.

Read more...More Apartment Residents Say They Can’t Pay Rent for May via GlobeSt

Friday, April 24, 2020

The Outlook for Class-C Apartments Is Muddied by Tenants' Loss of Income via NREI

Class-C apartment tenants have been badly hurt by the economic shutdown precipitated by the novel coronavirus, crushing their ability to pay rents, thereby putting strain on those properties’ owners to continue to cover costs and mortgage payments.

More than 22 million Americans have filed for unemployment in recent weeks. Others are working on reduced hours. Large parts of the U.S. economy remain shut down as states have ordered non-essential businesses to keep closed.

Read more...The Outlook for Class-C Apartments Is Muddied by Tenants' Loss of Income via NREI

Rental Market Slowdown Could Hit Class A Hardest via Multi-Housing News Online

After a decade of growth in the number of high-earning renter households, the impact of the coronavirus outbreak could cause that number to stall, leaving owners of luxury rental properties struggling to lease apartments.

According to research from the Joint Center for Housing Studies at Harvard University, while the length of the pandemic is still uncertain, there are early signs that point to a slowdown in demand in the U.S. rental market. Leasing activity is down at a time when apartment completions are approaching a 30-year high and the growth of renter households has slowed.

Read more...Rental Market Slowdown Could Hit Class A Hardest via Multi-Housing News Online

Thursday, April 23, 2020

Apartment Market Conditions Dramatically Weaken Amid Coronavirus via GlobeSt

Apartment market conditions significantly weakened in the National Multifamily Housing Council’s Quarterly Survey of Apartment Market Conditions for April 2020. The survey found that indexes tracking Market Tightness (12), Sales Volume (6), Equity Financing (13), and Debt Financing (20) all came in well below the breakeven level of 50.

The reason for these declines, of course, is the economic havoc brought on by the coronavirus.

Read more...Apartment Market Conditions Dramatically Weaken Amid Coronavirus via GlobeSt

Multifamily Executives Worry That Strong Rent Performance Won’t Last via Multi-Housing News Online

Apartment owners were happy with April’s rent payment results—which found that 89 percent of renters made rent payments through the 19th of the month, down only 5 percent compared to the same period a year ago, according to the National Multifamily Housing Council’s latest weekly survey. But industry leaders know that it is too soon to breathe easy.

Read more...Multifamily Executives Worry That Strong Rent Performance Won’t Last via Multi-Housing News Online

Wednesday, April 22, 2020

NMHC Rent Payment Tracker APRIL 1-19, 2020 via NMHC

The National Multifamily Housing Council (NMHC) found that 89 percent of apartment households made a full or partial rent payment by April 19 in its survey of 11.5 million units of professionally managed apartment units across the country, up 5 percentage points from April 12.

NMHC’s Rent Payment Tracker numbers also examined historical numbers and found that 93 percent of renters made full or partial payments from April 1-19, 2019, and 93 percent of renters in March 1-19, 2020. The latest tracker numbers reflect a payment rate of 95 percent compared to the same time last month. These data encompass a wide variety of market-rate rental properties, which can vary by size, type and average rental price.

Read more...NMHC Rent Payment Tracker APRIL 1-19, 2020 via National Multifamily Housing Council

Friday, April 17, 2020

Freddie Mac Boosts Multifamily Forbearance Program via Multi-Housing News Online

Freddie Mac has updated its Multifamily COVID-19 forbearance program to enhance protections for borrowers and renters, as widespread job losses due to the public health emergency threaten many Americans’ ability to pay their bills. The revised rules extend the duration of the program and bar multifamily landlords from evicting renters or charging late fees for nonpayment during the program’s forbearance period.

Read more...Freddie Mac Boosts Multifamily Forbearance Program via Multi-Housing News Online

Thursday, April 16, 2020

April’s Apartment Rent Defaults Weren't That Bad After All via GlobeSt

When the National Multifamily Housing Council reported a drop in April rent payments last week, executives acknowledged the numbers could improve as they expected many tenants would be paying late.

Turns out, they were right.

In its weekly update to its rent tracker report, the association found that 84% of apartment households made a full or partial rent payment by April 12, up 15 percentage points from April 5.

Read more...April’s Apartment Rent Defaults Weren't That Bad After All via GlobeSt

ALN Monthly Market Stats April 2020 via ALN Apartment Data

ALN Data just released their March 2020 market stats on occupancy and rents for over 80 markets. In Texas, it includes DFW, Austin, Houston, San Antonio, Lubbock, Amarillo, Abilene, Corpus Christi and more. It is a must read from a great provider of apartment data.

Read more...ALN Monthly Market Stats April 2020 via ALN Apartment Data

Wednesday, April 15, 2020

Eleventh District Beige Book 4/15/2020 via Dallas Fed

There was sudden and broad-based weakening of the Eleventh District economy during the reporting period. Many firms reported a sharp reduction in activity, resulting from business disruptions and closures due to the COVID-19 pandemic. Activity in the energy, retail, and service sectors was the hardest hit. Overall factory output and new orders plunged, though production in food and printing-related manufacturing increased. Loan demand contracted broadly and credit quality eroded slightly, except in residential real estate lending. Housing demand held up through mid-March but has declined notably since then. Employment and hours worked plummeted, resulting in downward wage pressures. Input costs were flat to down, and selling prices dipped amid declining demand for many products and services. Outlooks worsened markedly and uncertainty surged, as the economic impact of the COVID-19 pandemic and related containment measures intensified.

Read more...Eleventh District Beige Book 4/15/2020 via Dallas Fed

Thursday, April 9, 2020

A Look at Who Didn’t Pay Their Rent This Month via GlobeSt

In its debut rent tracker report, the National Multifamily Housing Council reported that 69% of households had paid their rent, either partially or in full, by April 5, compared to 81% that had paid by March 5, 2020. The rent tracker is based on data from 13.4 million rental apartments. The association has partnered with several firms to create this metric, including RealPage, Yardi and Entrata.

This increase in nonpayment comes as little surprise given the millions of people thrown out of work over the past month. With more layoffs and furloughs expected, the metric provides some insight into how the unfolding coronavirus crisis might affect the apartment industry on a wider scale.

Read more...A Look at Who Didn’t Pay Their Rent This Month via GlobeSt

Without Immigration, U.S. Economy Will Struggle to Grow via Dallas Fed

The coronavirus (COVID-19) pandemic has triggered dramatic, deteriorating economic conditions across the country. At some point, however, the effects of the shock will diminish. And the buffeted U.S. economy emerging from the health crisis will face some familiar structural challenges that predated the virus—among them, the slowing growth of its workforce.

Read more...Without Immigration, U.S. Economy Will Struggle to Grow via Dallas Fed

CRE’s Recovery Will Take At Least a Year, Trailing the Economic Rebound, CBRE Says via GlobeSt

In the space of just a few weeks the outlook for the US commercial real estate sector, to say nothing of the overall economy, has been utterly upended. Research firms are adjusting their initial expectations that the coronavirus would leave just a glancing blow on the industry.

A new report from CBRE finds that the US is in recession with GDP declines expected in the first and second quarter. It forecasts that the economy will stabilize in the third quarter, start to recover in the fourth, and grow at more than 5% in 2021 due to pent-up demand and major government stimulus.

Read more...CRE’s Recovery Will Take At Least a Year, Trailing the Economic Rebound, CBRE Says via GlobeSt

Wednesday, April 8, 2020

Building owners aren’t panicking yet about rent relief requests via Dallas Morning News

Commercial building owners are already facing a flood of pleas for rent forbearance.

Just dealing with tenants’ rent relief requests is going to be a challenge for the industry. Staggering numbers of businesses are suddenly struggling to pay their landlords as a result of the COVID-19 pandemic.

Prologis, one of the country’s largest industrial building owners, says it has gotten rent relief requests from almost one in four of its more than 5,000 nationwide tenants.

Read more...Building owners aren’t panicking yet about rent relief requests via Dallas Morning News

NMHC Rent Payment Tracker via National Multifamily Housing Council

The National Multifamily Housing Council (NMHC) found a 12-percentage point decrease in the share of apartment households that paid rent through April 5, in the first review of the effect of the COVID-19 outbreak on rent payments. The Tracker found 69 percent of households had paid their rent by April 5; this compares to 81 percent that had paid by March 5, 2020, and 82 percent that had paid by the same time last year.

Read more...NMHC Rent Payment Tracker via National Multifamily Housing Council

Tuesday, April 7, 2020

Multifamily Waits for Forbearance via GlobeSt

Last month Treasury Secretary Steven Mnuchin formed a task force of regulators to address how to ease the expected liquidity shortfall for mortgage firms. He asked the task force to offer recommendations by March 30. Since then little has been said about the task force other than a press release that it convened and that “Ginnie Mae and the Federal Housing Finance Agency will continue to monitor closely the markets and the condition of the nonbank entities that service Ginnie Mae, Fannie Mae and Freddie Mac MBS.”

Tired of waiting, this past weekend 15 real estate trade associations and affordable housing advocate groups called on the Federal Housing Finance Agency, the Federal Reserve and the Department of the Treasury to establish a liquidity facility for servicers that would support the foreclosure moratorium established in the CARES Act.

Read more...Multifamily Waits for Forbearance via GlobeSt

Supreme Court of Texas extends suspension on evictions until April 30 via Dallas Morning News

The Supreme Court of Texas extended its moratorium on evictions Monday, announcing that the suspension will continue until April 30.

The extension adds 11 days to its original moratorium, which began March 19.

Locally, some counties suspended evictions for a longer time period. Dallas County’s suspension of evictions runs through May 18. Tarrant County’s is indefinite, for the time being.

Read more...Supreme Court of Texas extends suspension on evictions until April 30 via Dallas Morning News

How to Price a Deal in Today’s Market via GlobeSt

Some investors have halted all acquisitions, but for those still trying to transact in this market, it can be challenging. Everything from underwriting in this uncertain market to completing due diligence with social distancing restrictions has made simply doing a deal difficult.

“This is not going to go on forever, but it is going to go on for a while,” Mark Weinstein, founder and president at MJW Investments, tells GlobeSt.com. “Now, we are just trying to figure out where the rents and occupancy will be a year from now. We are assuming that we will have to absorb everything for the next year, and we have to factor those carrying costs.

Read more...How to Price a Deal in Today’s Market via GlobeSt

Monday, April 6, 2020

Seven Rules for Lenders Navigating Workouts During Uncertain Times via NREI

It's time to go back to basics and adhere to some key guidelines to help navigate the choppy waters facing commercial real estate financing.

If the current coronavirus (COVID-19) situation persists, real estate lenders increasingly will be faced with the need to restructure loans in their portfolios. Lenders that held non-performing real estate loans during prior real estate downturns (e.g., 2008, 1990s) have no doubt embarked on the real estate workout process countless times before. However, with the passage of time, the lessons learned by real estate lenders of earlier eras may have faded from memory.

Read more...Seven Rules for Lenders Navigating Workouts During Uncertain Times via NREI

Missing: 20,000 DFW apartment renters to fill new units via Dallas Morning News

Not only home shoppers have hit the pause button. Prospective apartment renters are also sheltering in place in the face of the COVID-19 epidemic.

That’s bad news in North Texas, which has the most new apartment communities hunting for new tenants, according to a new report by RealPage.

“The drastic drop in renter mobility creates some real challenges for properties in the midst of initial lease-up - and D-FW has lots of those,” said Greg Willett chief economist at the Richardson-based apartment industry service firm.

Read more...Missing: 20,000 D-FW apartment renters to fill new units via Dallas Morning News

Multifamily market permits continue to decline via HousingWire

Prior to stay-at-home orders and businesses closing, the multifamily market was already seeing a decline in both permits and starts, a new report from RealPage said.

Permits fell to 415,000 units on a seasonally adjusted annual basis in February, marking the second-lowest annual rate in 17 months, down 20.2% from January and 5% from February 2019.

Now, due to the effects of the coronavirus, permits are more likely to decrease, although many local governments have deemed construction and real estate an essential industry.

Read more...Multifamily market permits continue to decline via HousingWire

Friday, April 3, 2020

Fannie, Freddie Raise Reserve Requirements as Loan Standards Tighten via Multi-Housing News Online

As lenders nationwide hunker down and prepare for an economic downturn, Fannie Mae and Freddie Mac are implementing stricter multifamily loan terms.

The GSEs remain open for business, but many borrowers will have to provide more equity and will be required to put 12 to 18 months of payments into a reserve account. That is a tough ask for all but the most well-capitalized borrowers.

Read more...Fannie, Freddie Raise Reserve Requirements as Loan Standards Tighten via Multi-Housing News Online

Thursday, April 2, 2020

Texas reeling into recession from double blows of coronavirus and oil slump, Comptroller Glenn Hegar says via Dallas Morning News

Texas’ usually buoyant economy has just run over two sharp nails — coronavirus and low oil prices — and the resulting slowdown is dramatic, Comptroller Glenn Hegar said Wednesday.

“There’s no doubt that Texas is going to be in a recession — just like pretty much the rest of the world,” he said.

While data showing the scope of the state’s economic contraction won’t be out for another few weeks, Hegar said early signs from counties that collect sales tax on motor vehicle purchases and rentals showed significant declines for a limited part of last month — all that’s been reported so far.

Read more...Texas reeling into recession from double blows of coronavirus and oil slump, Comptroller Glenn Hegar says via Dallas Morning News

The COVID-19 Economic Shutdown is Already Hitting Multifamily Rents via NREI

The average rents on apartments are already dropping, as the U.S. economy grinds to a halt and millions of workers have lost their jobs, been furloughed or have been asked to stay home to fight the rapid spread of COVID-19.

“Job losses are already affecting demand for apartments,” says Andrew Rybczynski, managing consultant for CoStar Group. “The evidence is apparent in daily rent changes.”

Read more...The COVID-19 Economic Shutdown is Already Hitting Multifamily Rents via NREI

Wednesday, April 1, 2020

COVID-19: What’s the Long-Term Impact of Moratoriums on Apartment Evictions? via RealPage

On Sunday, the National Multifamily Housing Council endorsed a number of unprecedented measures in response to the COVID-19 crisis. Among them is a 90-day moratorium on most evictions, meaning apartment owners and managers effectively stripped themselves the ability to remove residents delinquent on rent. The move comes after a wave of local and state governments across the country put similar bans in place.

The timing matches an expected increase in delinquency as job losses mount (particularly in the hotel and restaurant sectors) and unemployment claims surge.

Read more...COVID-19: What’s the Long-Term Impact of Moratoriums on Apartment Evictions? via RealPage

COVID-19 Hit on Multifamily Will Be ‘Modest’ via Multi-Housing News Online

If the numbers from China are accurate—and there’s no way to be certain about that—the COVID-19-induced recession should be a rather short one, according to RCLCO, the Bethesda, Md.-based real estate advisory firm. And the apartment sector won’t feel too much of a sting.

Charles Hewlett, a managing director at the company, said during a webinar late last week that the economic turndown should last a relatively quick two months.

Read more...COVID-19 Hit on Multifamily Will Be ‘Modest’ via Multi-Housing News Online

CRE Loan Defaults Soar Under Trepp Stress Test But Won’t Be as Bad as Great Recession via GlobeSt

To gauge the impact of the COVID-19 disruption, Trepp has applied an economic and real estate forecast scenario to a portfolio of 12,500 commercial real estate loans.

The findings were perhaps to be expected: defaults are expected to increase, in some cases significantly.

Under the scenario Trepp used, the cumulative default rate across commercial mortgages overall will rise to 8%, up significantly from the current 0.4% default rate. The impact will be most immediate and severe in the lodging sector, with a cumulative default rate approaching 35%.

Read more...CRE Loan Defaults Soar Under Trepp Stress Test But Won’t Be as Bad as Great Recession via GlobeSt

Tuesday, March 31, 2020

For Some Family Offices, Now Is the “Buying Opportunity of a Century” When It Comes to CRE via NREI

As America grapples with the coronavirus-impaired economy, family offices are feeling the same uncertainty as other investors are. In some cases, it means it’s time for them to selectively search for commercial real estate opportunities. In other cases, it’s time to pause investment activity.

For investors who want to act rather than stand still, execution of acquisitions and sales has been hampered by market volatility and illiquidity, says Randy Hubschmidt, managing partner of Fortis Wealth, a multi-family office in King of Prussia, Penn. He’s seen deals extended or canceled altogether due to the inability to wrap up previously approved financing.

Read more...For Some Family Offices, Now Is the “Buying Opportunity of a Century” When It Comes to CRE via NREI

Texas Economic Activity Suddenly Contracts in March; Outlook Worsens Due to COVID-19 via Dallas Fed

The economic downturn in Texas has begun, recent data suggest. The coronavirus (COVID-19) outbreak initially affected manufacturers and retailers with supply lines in China. The virus’ subsequent arrival in the U.S. has produced a severe drop-off in demand for large parts of the service sector.

Some of the demand declines have intensified due to public health measures, such as social distancing and shelter-in-place policies. Additionally, record-low oil prices and the prospect of sustained depressed levels in the energy sector will further slow growth in Texas.

Before the COVID-19 outbreak in the U.S., economic activity in Texas had broadly improved. Service sector revenue and manufacturing production increased in January and February.

Read more...Texas Economic Activity Suddenly Contracts in March; Outlook Worsens Due to COVID-19 via Dallas Fed

Texas Service Sector Outlook Survey March 2020 via Dallas Fed

The Texas service sector saw a dramatic decline in March amid the ongoing coronavirus (COVID-19) pandemic and related measures, according to business executives responding to the Texas Service Sector Outlook Survey. The revenue index, a key measure of state service sector conditions, plummeted from 14.0 in February to -67.0 in March, an all-time low reading for the survey.

Labor market indicators reflected a sharp contraction in employment and significantly shortened workweeks. The employment index fell from 6.1 to -23.8, its lowest reading on record. The hours worked index drastically dropped over 47 points to -43.0, with nearly half of respondents noting a cut in employee hours.

Read more...Texas Service Sector Outlook Survey March 2020 via Dallas Fed

Will coronavirus permanently change CRE lending? via American Banker

The economic paralysis from the coronavirus outbreak could upend commercial real estate and accelerate loan losses for banks.

High vacancies are hurting hotels, while closed retail outlets are poised to cause headaches for malls and shopping centers. Offices could struggle over the long run as more Americans work remotely and employers decide they can get by with less space.

Those developments are apt to cause near-term credit issues and long-term adjustments in the CRE business.

Read more...Will coronavirus permanently change CRE lending? via American Banker

Monday, March 30, 2020

Multifamily Remains Long-Term Investment Vehicle via GlobeSt

Not only has COVID-19 upended Americans’ daily routines but also how capital is invested and transactions are conducted in the multifamily industry. While the caution level in the industry is warranted, that same cautiousness must be met with careful optimism based on detailed analysis, hard data and level-headed assessment of the new reality, says Berkadia.

Initial lease renewal rates exceeded 53% in 2019. According to RealPage, renewal rent growth has consistently registered around 4.5% annually for the past few years. Operators can also expect renters to stay put in the meantime as the COVID-19 crisis continues to unfold.

Read more...Multifamily Remains Long-Term Investment Vehicle via GlobeSt

Evictions in Texas are halted, but what happens to renters when the suspension lifts? via Dallas Morning News

The stress that comes with the first day of every month has never been more acute for Dallas Fort-Worth residents forced out of work by the COVID-19 pandemic.

For the week ending March 21, jobless claims in Texas soared more than 860%. And if the swamped phone lines at Texas unemployment offices are any indicator, the state could see those numbers rise even more.

To a degree, local and state officials anticipated this.

Read more...Evictions in Texas are halted, but what happens to renters when the suspension lifts? via Dallas Morning News

Texas Manufacturing Outlook Survey March 2020 via Dallas Fed

Texas factory activity declined sharply in March, according to business executives responding to the Texas Manufacturing Outlook Survey. The production index, a key measure of state manufacturing conditions, plummeted from 16.4 to -35.3, suggesting a notable contraction in output since last month.

Other measures of manufacturing activity also point to a sudden decline in March. The new orders index dropped to -41.3, its lowest reading since March 2009 during the Great Recession. Similarly, the growth rate of orders index fell to -44.9. The capacity utilization and shipments indexes fell to -33.4 and -33.8, respectively, also the lowest readings since the Great Recession. Capital expenditures declined sharply, with the index dropping from 6.9 to -34.3.

Read more...Texas Manufacturing Outlook Survey March 2020 via Dallas Fed

Friday, March 27, 2020

At Long Last, the Cycle Ends. What’s Next? via CPExecutive

Commercial real estate’s unusually long run of success over the past decade left many in the industry guessing when and how the cycle would end. Recessions aren’t inevitable, but nobody working in the industry today had ever before gone a decade without having to deal with a major downturn.

All the guessing about the next recession is now over. The fact that nobody had the “global pandemic” box filled in their recession bingo card is of no consequence. The economic effects of COVID-19 have been transmitted to the entire population, even as many states enact social distancing measures to avoid spreading the virus.

Read more...At Long Last, the Cycle Ends. What’s Next? via CPExecutive