The real issue is pricing, which will remain a challenge until COVID-19 releases its hold on the U.S. economy, note Mark Ventre and Darin Beebower of Stepp Commercial.
For the last four years, many multifamily industry pundits prognosticated that the bull run had endured for too long and the end was nigh. Yet, the economy continued to march along, outperforming and outliving nearly everyone’s expectations, and the rental market was solid—that is until COVID-19 hit, a black swan event no one saw coming.
As a large swath of the country continues to self-quarantine in a quasi-state of limbo between the end of the previous cycle and the beginning of the new one, much of the multifamily marketplace including buyers, sellers and lenders have taken pause.
Pricing an asset with so many renters unemployed and a fear that the worst of the recession is yet to come is challenging. Therefore, many apartment investors are circling the wagons, adopting a wait-and-see approach and bracing for a difficult May and June rent collection period.
Read more at CPExecutive.com