03/27/2024
History doesn’t repeat but it rhymes, and out of the last four real estate crashes it’s always the over-leveraged players that get washed out. Real estate crashed in 2008 and then began a slow recovery to eventually a market that was on fire from 2018 through 2022. Anyone with an Instagram account, or flipped a few houses or had been a Limited Partner in a few apartment buildings was suddenly multifamily genius.
Several factors should be considered before investing in multifamily assets in the near future:
❗️ The Multifamily Debt Crisis (Looming Debt Maturity Wall)
❗️ Property Values are Falling (Higher Cap Rates)
❗️ Interest Rates Higher For Longer
❗️ Higher Vacancy Rates
❗️ Higher Operating Expenses
❗️ Value Add Multifamily Profits Have Proved Illusory
❗️ Inexperienced Sponsors Who Enter The Industry Will Be Washed Out
Find out about the Multifamily Meltdown and why it could get worse before it gets better: https://libertyfund.io/resources/multifamily-meltdown/