2010 Apartment Forecast: Uncertainty, But Optimism

LOS ANGELES-”We expect GDP to begin recovering in 2010–but at a modest 1.7% to 2% percent growth rate.” So said Doug Culkin, president of the National Apartment Assoc., during his keynote address at RealShare Apartments 2009 conference. Culkin, along with other panelists throughout the full-day event, pulled together trend lines from established economists and research firms in the apartment industry to accompany their outlook. From their analyses, the coming year will be an interim period for the national economy, employment and the apartment industry and its financing.

The event, hosted by ALM’s Real Estate Media Group, was held Oct. 8 at the Westin in Downtown Los Angeles and attracted more than 1,000 attendees, all hoping for some kind of clarity on the current state of the national apartment market.

The Fed has revealed that interest rates will remain low–but consumer spending “is also expected to remain dampened by Americans’ wait-and-see attitude on a number of economic and policy fronts,” Culkin said. “Anxiety about jobs will continue.” Culkin expects unemployment to hit the 10% threshold very soon, followed by a long, slow downward trend as employers gradually begin hiring. In California, unemployment has remained higher than the country as a whole–currently over 12%.