National housing conditions may show signs of improvement, according to homeowners, as they responded to the National Multi-Family Housing Council's quarterly survey of housing market conditions.
The market tightness index rose from 19 to 35, which indicates a loosening of the market. According to the survey, 49% of respondents said market conditions were looser than they were in the previous three months. Only 18% of respondents said that market conditions are stricter than in the previous three months, while 33% of respondents said market conditions were unchanged. According to NMHC chief economist Mark Obrinsky, market conditions continue to deteriorate, but the market density index shows that respondents' market prospects vary increasingly.
Other areas of the survey show an improvement in market conditions. The sales volume index rose from 18 to 72, and 60% of respondents said that sales volume was higher than in the previous three months. This was a significant majority. Only 16% of respondents said sales volumes had decreased compared to the previous three months, and 19% found the market unchanged. These data show that investment capital is returning to the market after the withdrawal at the start of the pandemic. Historically low interest rates and greater availability of debt have helped bring capital back into the market.
On the leverage index, more than half – 51% – of those surveyed find it easier to secure financing than in the previous quarter, and 35% of those surveyed believed that the market was unchanged. Only 6% of respondents said that debt conditions were worse than in the previous quarter.
Finally, the equity finance index also showed stable market conditions. Most of the respondents for this part of the survey – 42% – said market conditions for stocks have remained unchanged from the last three months. However, 35% said conditions were improving, while 12% of respondents found equity financing was less available than in the previous quarter.
Overall, the market prospects for apartment owners are improving. In the survey, respondents were asked to share their outlook on these trends and 46% expect these conditions to persist for six to 12 months after the pandemic ends, while 31% of respondents believe these trends will end with the end of the pandemic will end. Only 8% of respondents believe these market conditions will last indefinitely – the most pessimistic outlook – while the additional 16% were unclear about the future of the market.