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Apartments' Inflection Point: Vacancies Seen Rising

“Now the critical mass of supply deliveries is weighing on the sector,” says Peter Muoio with Ten-X.

By Paul Bubny | Updated on January 24, 2018

Ten-X's Peter Muoio Muoio: “The downturn’s effects should not be cataclysmic for multifamily owners in most markets.”

IRVINE, CA—The Bay Area would appear to be Oversupply Central as far as multifamily is concerned. The region’s three largest metro areas—San Francisco, San Jose and Oakland—are also the three leading markets in which Ten-X Commercial research suggests that investors may want to consider selling their apartment properties, due mainly to a combination of a heavy construction pipeline and declining employment growth.

With New York City and Miami rounding out the top five “sell” markets, Ten-X sees the apartment market nationally reaching an inflection point as vacancies have begun ticking upward and rent growth has decelerated. “All good things come to an end, and this truism is now to become manifest in the multifamily sector where the long-anticipated turning of the cycle is underway,” says Peter Muoio, chief economist with Ten-X.

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