This week’s roundup offers insights on opportunity zones, multifamily construction trends and 2020 predictions for the housing market. First, Trepp provides an update the Opportunity Zone program, including new regulatory developments and where investors are acquiring properties to take advantage of its benefits. Next, NAHB analyzes the average unit size of new multifamily construction, with the median shrinking from a post-recession high of 1,133 square feet in 2015 to 1,108 square feet as of third-quarter 2019. Arbor’s Chatter takes a look at single-family rental cap rates, which have remained steady despite interest rate volatility throughout this year. Then, Redfin provides its predictions for the housing market in 2020, including its expectations for a competitive landscape due to fewer available homes and low mortgage rates. Finally, releases its affordability report for the third quarter, which found that while homes are slightly more affordable than they were last year across the top 100 metros, most markets continue to suffer from a lack of affordable housing supply. 

An Update on Opportunity Zones: How will Regulatory Uncertainty Impact Investment?

Trepp – November 26

“The frenzy has since subsided considerably, but the program nonetheless continues to pique investor interest.”

Multifamily Built-for-Rent: 93% Market Share

NAHB – November 25

“The market share of rental multifamily construction starts held steady at 93% during the third quarter of 2019. In contrast, the historical low share of 47% was set during the third quarter of 2005, during the condo building boom.”

SFR Cap Rates Hold Steady as Benchmark Interest Rates Fall

Arbor Chatter – November 25

“Dating back to 2012, SFR cap rates reached a high of 11.0%. In the years since, they have dropped by more than 470 basis points (bps) to 6.3%.”

Redfin’s 2020 Housing Market Predictions

Redfin – November 25

“We predict the housing market will be more competitive in 2020 as the cooldown that began in the second half of 2018 comes to an end.”

Home-Ownership More Affordable than a Year Ago but Remains out of Reach for Many

National Association of REALTORS – November 25

“In the third quarter of 2019, 81 out of the nation’s 100 largest metros became more affordable compared to the same time period in the previous year, whereas 10 were unchanged and 9 became less affordable.”