A Look Ahead
- Oct 02, 2020
Nothing has been more certain in 2020 than uncertainty, especially when it comes to real estate.
Let’s start by talking about the elephant (and donkey) in the room: the upcoming presidential election. And regardless of who voters pick on Nov. 3, there will be ramifications for multifamily.
This month, Gail Kalinoski delves into the proposed policies of the two major party candidates, President Donald Trump and former Vice President Joe Biden. As expected, they are offering up significantly different positions. Funding for Section 8 properties could be slashed or bolstered. Low-income housing tax credits might be expanded. Carried interest could be taxed … or not. Fannie Mae and Freddie Mac might become, at least partially, public companies. Or the privatization push may come to an end.
Of course, in the industry, all eyes are on the eviction moratorium, which was enacted by the Trump administration at the beginning of September and extends to the end of the year, with a goal of protecting those who are facing economic hardship because of COVID-19. While some view this as beneficial for renters who were hit hardest by the pandemic, some members of the industry say the policy might be harmful for those working in multifamily. A statement issued by the National Multifamily Housing Council said that the policy “does nothing to address the financial pressures and obligations of rental property owners.” And the National Apartment Association has joined a lawsuit challenging the moratorium. “A nationwide eviction moratorium without any kind of financial or direct rental assistance will exacerbate the nation’s housing affordability crisis and reverberate into national, state and local economies,” NAA President & CEO Robert Pinnegar said in a statement. This issue will need to be revisited down the line.
Add to all this the chaos that the pandemic has strewn—from stay-at-home mandates to job losses to businesses closing—and it’s no wonder tensions are running high.
But it’s not all doom, gloom and uncertainty. Steve Guggenmos, vice president of research and modeling for Freddie Mac, told Robyn Friedman that multifamily is still benefiting from the coronavirus relief bill, and that renters have “prioritized paying their rent.”
As we look ahead, all of us in multifamily should hope for the best but be prepared and stay vigilant.
“Six months from now, we’re hoping to see some improvement,” Guggenmos said, “but it can’t be known for sure.”