Every spring and fall, Multifamily NW provides an in-depth look at Oregon’s multifamily market summarized in their Apartment Report. Here are a few key findings to help inform future multifamily customer outreach:
- Despite grim predictions in spring, the multifamily market remains relatively stable through the turbulence of 2020. Occupancy holds stable in most areas and the effective income decline due to rent moratoriums is less than predicted. Additionally, turnover rates are down and retention rates are up. However, the overall impact of rent moratoriums will not be realized until later in the new year.
- Multifamily investors are still buying properties. Although rent rates have remained mostly flat over the last six months, renter preferences have shifted from urban to suburban locations and from studios to larger apartments. In Portland, the Downtown area has been most affected as rent rates declined 7% and vacancy rates near 10%.
- Lending slowed by 48% in the second quarter of 2020. However, the volume of loan production in the fourth quarter of 2020 is on track to be one of the strongest quarters in history. Lenders have adapted to the challenges in 2020 and learned to mitigate risk by implementing new guidelines. Additionally, low interest rates continue to drive demand with some long-term fixed rate loans in the range of 2.5% to 4%.
Overall, 2020 has been a challenging year on all fronts, but the apartment market has held up remarkably well all things considered. Uncertainty remains but the dire predictions in spring were not wholly realized in 2020. The new year brings new challenges and new opportunities to better serve the multifamily market.
For more information, contact Nate Collins, trade ally coordinator, 503.278.3075.