As we previously reported, 2018 was a banner year for multifamily housing, with a 44% increase in sales accounting for more than 30% of the total U.S. real estate investment sales. What is the health of the 2019 multifamily housing market through the first two quarters, and where will it go from here? Freddie Mac has answered these questions and more in its Multifamily 2019 Midyear Outlook. Overall, the outlook is positive, showing signs of sustainability and growth for the remainder of the year and beyond.
According to Freddie Mac, “In our research, we find that strong economic growth and the robust labor market continue to support the strength in the multifamily market. Last year ended much stronger than anticipated with near record absorptions and stronger rent growth compared with the prior few years. The first two quarters of 2019 saw mixed results, with slower growth in the first quarter, but preliminary second quarter information indicating the spring leasing season is off to a strong start. Along with the strong fundamentals, lower interest rates continue to drive origination volume higher throughout 2019.”
It is anticipated that the labor market–with low unemployment and wage growth–will continue to drive housing demand, benefiting multi-family properties. As the report states, “Pending any broader economic event that would impact the labor market, there is no real estate specific headwind on the horizon that could disrupt the favorable outlook for multifamily through the rest of this year and into the next.”
Multifamily originations–or fees associated with processing a loan–are continuing their upward trend from 2018 through the first two quarters of 2019. Originations have increased by 8% to $336 billion. “The 10-year Treasury reached 1.75%, a decline of 150 bps (basis points) from last November,” the report says. “Rate declines generally drive origination volume higher, and with a drop of this magnitude to very low levels, forecasts must be decisively higher than earlier in the year.”
Absorption rates, by contrast, saw strong gains in 2018 only to stall thus far in 2019. “The first quarter of 2019 saw absorptions wane and high levels of new supply entered the market, but strong gains in the second quarter suggests the trends for multifamily are not yet turning.”
“In our research, we find that strong economic growth and the robust labor market continue to support the strength in the multifamily market.” – Freddie Mac
Multifamily demand is outpacing new supply, as there is a shortage of housing compared to households. Total housing completions over the past three years have averaged 1.1 million housing units each year, while the number of households have increased on average 1.4 million. Per the report, “The continued increase in multifamily construction when the overall housing market continues to remain unbalanced is not necessarily an oversupply concern as the economy struggles to build enough housing.”
The multifamily market is bright. Freddie Mac projects overall growth for the remainder of 2019 and into 2020 with high-demand spurring on new construction. “As this supply enters the market, we expect vacancy rates to increase throughout the year, but only marginally, up to 5.2%. We anticipate that rent growth will remain healthy at around 4% in 2019.”
“This trend really helps increase patient satisfaction by improving comfort and mental well-being, “ says CME. “Patients in waiting rooms that are well-designed are often more patient and find average wait times more agreeable.”
Innovative medical practices design spaces that leverage technology to improve patient satisfaction and make it easier for staff to do their jobs. Renovating offices to incorporate digital kiosks, for example, creates many advantages. Patients can check themselves in or out and make follow-up appointments, front desk staff can focus on important tasks, and congestion due to foot traffic is reduced.
“This current landscape is in large part the result of private physicians joining group practices at large healthcare systems and institutions creating specialty clinics to maximize their service offerings and broaden their reach,” According to Healthcare Design Magazine. “And exactly what shape those efforts take is key to providers differentiating themselves among the competition.”
The more functional a medical office, the better engagement and productivity are among staff. Care team members benefit from collaborative spaces, compared to dedicated physician’s offices. These onstage/offstage layouts are growing in popularity and place clinical staff in a central core and create group work areas where nurses and physicians work alongside each other.
In many ways, bedside manner extends beyond provider and patient interaction to the way patients feel about the environment of a medical office. Renovations that are patient-centric and cater to their comfort needs will create a winning situation for them, as well as providers, and property owners and managers.
“My favorite journey is looking out the window.”
Window replacement is one of the smartest improvements one can make to their home, condo or apartment building. Today’s products are designed to be maintenance-free, highly efficient in terms of insulating your home from winter’s cold and summer’s heat, easy to operate and clean as well as a way to beautify your home’s exterior and interior. Whether you prefer vinyl, wood or fiberglass products, all will provide you with an exceptional value and easy operation.
Below are some of the top reasons that windows are replaced:
The existing windows are not operating properly. This may mean that the double hung sashes or storm window sashes don’t open (or stay open). Broken lift systems are dangerous and don’t allow windows to properly operate. Casement windows can also have operational issues if the lock mechanisms don’t properly grab the hasp or the if roto operator is stripped. These are reasons to consider replacement.
Older windows (anything older than 25 years old) are not energy efficient. At a minimum, new windows should be thermal-pane technology (two pieces of glass hermetically sealed with a non-conductive spacer system). Low emissivity glass (Low ‘E’) and argon gas should be added to boost the R-value (or lower the U-value) of the glass unit. Additionally, new windows have wool or vinyl weatherstripping where the sashes meet the main frames which cuts down on drafts.
New windows are virtually maintenance-free and easy to clean. Midwest weather and the extreme cold and heat seasons are particularly hard on the exterior of older windows. Windows that have wood exteriors are more prone to rot over the years. A new window replacement will provide no maintenance at the exterior as most replacement windows are either vinyl or aluminum clad exteriors. Also, double hung windows tilt in to clean and casement windows fully swing open to provide ease of cleaning even if the windows are on the 2nd or 3rd Floors.
If you are looking for a smart, relatively inexpensive way to enhance the beauty of your home, a window replacement project can really modernize and beautify your home’s exterior (and interior too). New windows have design elements like internal muntins (grids), designer glass, pre-finished paint or stain options (if wood interior) and many exterior colors that can transform the look of your home. Projection windows like bay windows, bow windows or garden windows create space on the interior and create a great focal point on the exterior.
Mosaic Construction believes first impressions really matter and the exterior finishes have the greatest impact on curb appeal. We understand that the definition of a successful renovation is unique to each property owner. At Mosaic Construction, we partner with commercial and residential property owners to enhance and upgrade their exteriors. We have the expertise to complete renovations of nearly every scope and size.
What to Expect
• Consult – we will provide counsel to clarify your needs to construct the ideal plan.
• Construct – we will assist in choosing building products and options that will maximize your
property’s functionality, structure and overall aesthetic value.
• Transform – our process will ensure that your project will be on-time, on-budget and exceed your
Our Expertise Includes
• Window Replacement
• Door Replacement
• Composite & Vinyl Siding
• Gutters/Downspouts & Soffit/Fascia
• Deck & Porch Construction
• Masonry & Stone Construction
• Architectural Enhancements