In a new podcast episode, Paula Munger discusses trends and challenges in multifamily as the industry prepares to enter recession territory next year.
Paula Munger, AVP, Research & Industry Analysis, National Apartment Association. Image courtesy of National Apartment Association
Following a record-breaking 2021, this year started out very strong for the multifamily industry. But the second half of 2022 saw high inflation, rising interest rates and an overall softening of the economy. As a result, multifamily starts began to drop due to tightening financing availability, rent growth tempered as household formation declined, and transaction activity also moderated because of the high cost of capital.
All these trends are anticipated to continue next year, but on the bright side, 2023 is expected to see a record for completions, with Sun Belt metros and suburban areas likely to continue to be the most in demand.
READ ALSO: SFR Market Trends to Watch in 2023
In this podcast episode, National Apartment Association Assistant Vice President for Industry Research and Analysis Paula Munger told Multi-Housing News Senior Editor Laura Calugar that despite the mild recession that is likely to occur next year, multifamily demand is still expected to be strong, at least for historically recession-resistant subsectors like workforce and middle-income housing.
Press play to learn more about what Munger anticipates for multifamily in 2023, and why she’s still optimistic about the sector’s capacity to overcome a decline in economic activity.
Here’s a list of the main topics discussed:
- Top takeaways from 2022 (0:43)
- Is the construction boom slowing? (1:49)
- Barriers to building (3:18)
- Apartment demand in 2023 (5:05)
- Rent control initiatives (8:35)
- Housing affordability (10:48)
- Labor shortages (12:00)
- Preparing to enter recession territory (13:47)
Don’t forget to follow MHN’s podcasts on Apple Podcasts and Spotify!
