Multifamily Predicted to Hit Bottom by Year End

Posted by admin on January 16, 2010 under Uncategorized | Be the First to Comment

By Jerry Ascierto

If you thought the multifamily industry bottomed out in 2009, hold on to your hats. The murky depths of the Great Recession are still to come. It could be another few quarters before the multifamily industry reaches the bottom of the current cycle, according to several recent reports.

More overleveraged developers and owners, surviving on loan extensions, will be forced to turn in the keys in 2010 as fundamentals continue to fall before the market hits bottom around the end of the year. Once there, value declines will approach about 40 percent, on average, from the mid-2007 peak—the worst decline since the Great Depression and worse than seen in the early 1990s. Those are just some of the sobering conclusions reached by The Emerging Trends in Real Estate report, recently released by the Urban Land Institute and PricewaterhouseCoopers.

While there have been much fewer “fire sales,” than in the RTC days, “the quickness at which fundamentals have declined, and the pace at which values have deteriorated, is the difference between now and then,” says Susan Smith, director of real estate……Read more HERE