Monday, October 29, 2007

NAR Report Backs Up This Author's Predictions

I'm no Uri Gellar, but basic fundamentals are basic fundamentals. Early last spring I predicted multifamily would continue to strengthen due to the looming credit crisis. Specifically, my belief was, and continues to be, that as credit for risky borrowers became more difficult to obtain, people who were planning to buy houses would continue to stay in apartments. I also stated that many people losing their homes would turn to apartments for living space.

I caught a lot of flak from people within this industry for being "negative." I wasn't being negative, I was looking ahead on behalf of my clients. Well here we are. The market stayed strong. The National Association of Realtors' latest Commercial Real Estate Outlook says the following: ". . . Potential first-time home buyers are hesitant and staying in the rental market, supporting multifamily fundamentals until the lure of home ownership returns, the housing cycle changes and more buyers enter the housing market." Interestingly, the report also notes that there has been a slight impact on multifamily from an unforseen growth of single family homes offered for rent due to their owners being unable to get them sold.

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