Multifamily Growth Amid Challenges

Unveiling the Market's Secrets from Behind the Scenes

January 30, 2025

irene@nuyvoc

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“Rate cuts before December supported some momentum in multifamily and commercial starts over the month. Sustained labor shortages and elevated materials prices will continue to add risk to the sector, in addition to the concern over tariffs and more strict immigration enforcement. Overall, the strength in the value of projects in planning and further Fed rate cuts should encourage growth in construction in 2025.”

-Sarah Martin, Associate Director of Forecasting at Dodge Construction Network

Recent Multifamily Sales (Click to view details)

Recent Multifamily Loans (Click to view details)

Question:

What are the key metrics to track when monitoring the performance of a multifamily investment?

Answer:

Key metrics to track when monitoring the performance of a multifamily investment include:

Net Operating Income (NOI): Calculated as rental income minus operating expenses, NOI indicates the property's profitability.

Occupancy Rate: The percentage of occupied units compared to total available units, which reflects the property's ability to attract and retain tenants.

Cap Rate: The ratio of NOI to property value, used to assess the property's return on investment and compare it to other investments in the market. Tracking these metrics provides insights into the financial health, operational efficiency, and overall profitability of the multifamily investment over time.

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Understanding The Nationwide Multifamily Market With Jay Parsons

Seth Glasser and Shaun Riney are joined by Jay Parsons, a renowned rental housing economist based in Dallas. Jay shares his extensive experience advising multifamily and single-family rental housing stakeholders, including institutional investors, REITs, and government agencies.

The conversation explores current trends in rental economics, supply and demand pressures, the impact of regulatory risks, and the role of AI in property management. Jay also discusses the implications of current market conditions for investors and the effectiveness of various strategies to support affordable housing.

Quiz of The Week

What does the term “vacancy rate” refer to in multifamily real estate?

a. The percentage of tenants who pay rent late

b. The percentage of units that are unoccupied

c. The percentage of units that require maintenance

pǝᴉdnɔɔoun ǝɹɐ ʇɐɥʇ sʇᴉun ɟo ǝɓɐʇuǝɔɹǝd ǝɥꞱ .q

Random Tip of the Week

💰 Understand Vacancy Loss Trends - Research the average vacancy rate in your target market and adjust your financial projections accordingly. High vacancy rates may signal a need to adjust your rental strategy.

Current Rates (Weekly Update)

10-Year Treasury - 4.53% (⬇️ .03%)

Fed Funds Rate - 4.33% (0%)

1-Month Term SOFR - 4.31% (⬆️ .01%)

About Nuvo Capital Partners

Nuvo Capital Partners is a niche market-focused multifamily investment platform operating throughout the Southeastern United States. As a dedicated sponsor (General Partner), we specialize in institutional quality real estate investments within these regions. Our team comprises industry professionals with 25+ years of combined experience, ensuring expertise and market knowledge. We pride ourselves on offering a transparent investment process, providing our investors with access to high-quality real estate opportunities while upholding integrity throughout.

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