Apartment appeal is weakening for some investors via MarketWatch

The apartment sector, one of the best-performing of the commercial real-estate market in recent years, is starting to lose some appeal for investors.

Last year, residential rental properties were one of the most sought-after property types, with sales totaling $54 billion by one measure, up more than 50% from the prior year, according to Real Capital Analytics. The average apartment price per unit, about $102,000 nationally, is near peak levels.

But this year, the excitement is fading. Investors are pushing back on property prices, rent growth is slowing and yields are flattening in some markets.

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