Fueled by fears of a continued rise in inflation, investors are aggressively bidding up apartment prices.
Nationally, the average apartment cap rates stand at 5.1%, but that's for closed transactions, according to John Chang, senior vice president and director of research services at Marcus & Millichap.
"The demographics and the housing needs point to particularly strong demand over the next few years," he said. "Based on what investors are telling me today, the bid climate is particularly aggressive, putting downward pressure on cap rates."
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