Texas emerged as a top market for apartment investment in 2020 and 2021 as investors changed their appetite for Sunbelt metros. Dallas-Fort Worth (DFW) and Austin have been the target for institutional players and out-of-state investors. Austin’s large presence of 20-34 year-olds, paired with its strong economic performance, has made it one of the most compelling Sunbelt markets in the country. For three years in a row, over $2 billion in multifamily sales has been achieved (Note, Texas is a non-disclosure state and this figure is based only on the data provided). With record-setting demand and rent growth in Dallas-Fort Worth, the average pricing for multifamily assets has appreciated 15 percent in the last year. In Dallas-Fort Worth, Fannie / Freddie Small Balance Loans (SBL) traditionally dominated the multifamily market offering the most competitive long-term debt. There is now more competition from conventional banks, especially program/platform multifamily banks who have found great success in West Coast markets and are looking to expand into Texas and other strong Southern markets. Now is the time to secure long-term financing. The start of this year alone has brought an average ~25 bps on the ten-year US Treasury. While the Federal Reserve may attempt to reduce movement in Q1 2022 and Q2 2022, there is major pressure from investors and bond markets to steepen the yield curve. Owners planning to hold their property for the next seven to ten years need to make significant strides to lock in low before rates rise.
Category: Capital Markets
Tags: Apartments, Capital Markets, Multifamily, texas
Recent Articles
Recent Media & Thought Leadership
7/13/2023
Market Report | Industrial | Dallas-Fort Worth, TX
Q2 2023 Dallas-Fort Worth Industrial Market Report Market Overview While...
7/13/2023
Exploring QSR, Casual Dining, and Fast Casual Restaurants
Exploring Restaurants Across the U.S. The U.S. restaurant industry is...
7/13/2023
Matthews™ Market Update | Q2 2023 Market Report
Matthews™ Market Update Macroeconomic Overview A year of volatility has...
7/11/2023
Q2 2023 Hospitality Market Report | Northern California
Northern California Hospitality Market Report Market Overview The hospitality sector...
7/10/2023
The Transforming Landscape of Industrial Real Estate Rents
An Update on Industrial Rents The industrial real estate market...
7/10/2023
What is the Relationship Between Interest Rates and Cap Rates?
Interest Rates vs. Cap Rates The real estate market is...
7/10/2023
How to Maximize ROI in CRE
Maximizing ROI in CRE In today's competitive real estate market,...
7/7/2023
Why Brokers Should View Auction Platforms as a Sales Tool
Auction Platforms Commercial real estate brokers are, generally, antagonistic...
7/7/2023
Leasing Trends in California
California Leasing Landscape The leasing landscape in California has witnessed...