The multifamily real estate sector has experienced a significant resurgence in 2024, with apartment sales soaring by 40% year-over-year, reaching $10.5 billion in November.
Key Drivers of Growth
A pivotal factor in this upswing was Blackstone’s June acquisition of Apartment Income REIT Corp. (AIR) for $10 billion, one of the largest deals in the sector’s history.
Multifamily Dive
Transaction Breakdown
Individual Property Sales: Increased by 13% year-over-year, totaling $7.9 billion in November.
Portfolio Deals: Experienced a remarkable 420% surge of $2.6 billion.
This growth indicates renewed investor confidence in the multifamily market.
Market Segmentation
Garden Properties: Sales rose 48% year-over-year to $6.8 billion, remaining 4% below 2023 levels for the first 11 months. Mid- and High-Rise Apartments: Sales increased 27% year over year to $3.6 billion, surpassing 2023 figures by 13% over the same period.
Pricing Trends
Despite the surge in sales volume, prices have declined by 5.7% year-over-year as of November.
Expert Insights
Matt Ranalli, co-founder and chief investment officer of Boston-based apartment ownerstment Partners, observes increased market activity:
“There’s a softening from nine months ago, 12 months ago or 18 months ago. There is capital stepping back into the market to try to buy.”
However, Jay Parsons, head of investment strategy at Lubbock, Texas-based Madera Residential, notes that overall volumes remain subdued:
“Obviously, there’s been some big portfolio trades, but the total volumes are still low.”
What’s Next
The multifamily market’s rebound in 2024, highlighted by significant transactions like Blackstone’s acquisition of AIR, reflects a complex landscape of increasing sales volumes amid declining prices.
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