More than 300,000 multifamily units entered the market across the United States in 2015, according to Freddie Mac’s 2016 Multifamily Outlook report.
That’s the most new apartment units in a single year since 1989, according to Freddie Mac. And Freddie expects another surge of new units to enter the market in 2016. That’s because the number of new-construction permits for multifamily projectes rose again in 2015.
Last year saw a second record for the multifamily market, too: Freddie Mac says that multifamily loan orginations hit a record volume in 2015. Researchers are predicting that industry originations will only soar to a new record in 2016, growing to $250 billion to $260 billion thanks to increasing property prices, new completions and maturities and favorable investment opportunities.
Here’s what’s most interesting about Freddie’s report, though: Despite the number of new multifamily units that came online in 2016, the national apartment vacancy rate barely moved. Freddie reported that it rose to 4.4 percent from 4.3 percent.
Freddie is predicting that because even more multifamily units will hit the market in 2016 that vacancy rates in this sector will increase slightly again this year, perhaps rising to 4.8 percent.
