“The rise in interest rates by the Fed has their expected effect on prices, due to the reduction of monthly rents in the country,” said Obrinsky. He also said that although the rents are still high compared to last year, it reflects the increase in the price of rent in right now.
NMHC’s total sales volume was below the default level of 10. About 82% reported a decrease in the number of four sales, the same as the previous quarter. Only 2% reported an increase in sales, while 13% reported no change.
The market order for this quarter came to 14, reflecting this adverse market conditions for two quarters in a row. The majority of respondents (78%) said that the market is tighter than three months ago, but only 5% reported that it is tighter. The remaining 16% saw no change in market conditions.
In addition, the 20-year budget count marked the fourth consecutive quarter of declining revenue. Almost two-thirds (63%) of respondents reported that equity financing is less available than three months ago. Similarly, the debt financing reading of 25 indicated the sixth straight quarter in which the availability of debt financing decreased. About 60% of respondents reported that conditions have worsened for debt financing.
“These rate increases are also translated into a high cost of debt financingcausing buyers to seek a higher rate of return,” said Obrinsky. “With buyers not wanting to get too bogged down in price, most Apartment transactions have largely dried up.”