For the Market Tightness index, 20% of respondents reported tighter conditions than three months ago, up from 8% percent in January. Thirty-eight percent said market conditions have gotten looser. Although the current survey represents the sixth consecutive quarter of overall declining conditions, it does mark an uptick from the last three months of 2016.

Fewer respondents reported an improvement in sales volume—just 11%. Half said volumes had declined from Q4 of last year.

Equity Financing hasn't come in above the break-even mark since NMHC's October 2015 survey. Conversely, the Debt Financing index registered as high as 62 within that time frame, but NMHC data show a more uneven ebb and flow in the Debt Financing index over the past four years, with the April '15 index of 60 followed by an index of 35 three months later.

However, the Debt Financing index, while still below the break-even mark, represented a substantial improvement over January's results. Just 35% of respondents reported worse conditions for borrowing, compared to 75% in the January survey. And the 16% of respondents who reported better conditions in the debt market, while still in the minority, made up more of a crowd than the 1% who said this last time.

Judging by one indicator—the Urban Land Institute's latest Real Estate Consensus Forecast, issued Wednesday—future quarterly NMHC surveys may report further declines in the Market Tightness index. “Vacancy rates decreased from 7.1% in 2009 to 4.6% in '15, before a slight uptick to 4.9% in '16, still remaining below the 20-year average,” according to ULI's forecast. “Vacancy rates are expected to continue upward the next three years, to 5.2% in 2017 and 5.3% in 2018, reaching the 20-year average of 5.4% in 2019.”

WASHINGTON, DC—As first-quarter rebounds in sentiment go, it wasn't the sprightliest on record. The National Multifamily Housing Council said Thursday that all four indexes of its latest Quarterly Survey of Apartment Market Conditions, conducted earlier this month among 140 senior executives of apartment-related firms, remained below the break-even level of 50 for the third consecutive quarter, although all four represented an improvement over the previous survey.

The Market Tightness and Debt Financing indices, both at 41 in the current survey, posted the biggest gains over the previous survey's results, up from 25 and 14, respectively. Equity Financing rose from 33 in the January survey to 42, while the Sales Volume index posted a modest increase from 25 three months ago to 30 currently. The sum total, according to NMHC, is continued softening conditions in apartment markets even as renter demand continues to be strong.

“After years of lagging behind the increase in apartment demand, new supply is finally coming on line in sufficient quantity to alter this supply-demand imbalance,” says Mark Obrinsky, SVP of research and chief economist with NMHC. “In particular, class A supply in many urban core submarkets has led to increased concessions to fuel lease-up activity. Even so, occupancy rates remain close to historic highs.”

Obrinsky acknowledges that some of the weakness seen lately in property sales is seasonal. However, he adds, “respondents reported caution on the part of buyers as well as debt and equity capital sources, in particular in regard to construction lending. Increased uncertainty about the outlook for interest rates and cap rates also appears to be playing a role.” The current survey's Sales Volume index is the second lowest in the past 17 quarters.

For the Market Tightness index, 20% of respondents reported tighter conditions than three months ago, up from 8% percent in January. Thirty-eight percent said market conditions have gotten looser. Although the current survey represents the sixth consecutive quarter of overall declining conditions, it does mark an uptick from the last three months of 2016.

Fewer respondents reported an improvement in sales volume—just 11%. Half said volumes had declined from Q4 of last year.

Equity Financing hasn't come in above the break-even mark since NMHC's October 2015 survey. Conversely, the Debt Financing index registered as high as 62 within that time frame, but NMHC data show a more uneven ebb and flow in the Debt Financing index over the past four years, with the April '15 index of 60 followed by an index of 35 three months later.

However, the Debt Financing index, while still below the break-even mark, represented a substantial improvement over January's results. Just 35% of respondents reported worse conditions for borrowing, compared to 75% in the January survey. And the 16% of respondents who reported better conditions in the debt market, while still in the minority, made up more of a crowd than the 1% who said this last time.

Judging by one indicator—the Urban Land Institute's latest Real Estate Consensus Forecast, issued Wednesday—future quarterly NMHC surveys may report further declines in the Market Tightness index. “Vacancy rates decreased from 7.1% in 2009 to 4.6% in '15, before a slight uptick to 4.9% in '16, still remaining below the 20-year average,” according to ULI's forecast. “Vacancy rates are expected to continue upward the next three years, to 5.2% in 2017 and 5.3% in 2018, reaching the 20-year average of 5.4% in 2019.”