Is the monetary tightening cycle over? Has the Fed orchestrated the illusive soft landing for our economy, reducing inflation to a sustainable level without sending the nation into recession? The answers to these questions are still yet to be fully determined, however last week’s lower inflation report provides further evidence that future interest rate increases me not be needed. Inflation dropped meaningfully in October compared to prior months, and annual prices are up only 3.2% from a year ago. As we approach the winter months, lower oil prices will likely keep inflation modest. With inflation in check and economic growth remaining robust, the possibility of a soft landing is growing. Most inflationary environments end in recession, however GDP remains strong and job growth is steady, especially given how tight the labor market remains. The multifamily industry continues its steady fundamental decline as the holidays approach. Rents nationwide slid again last week, but the annual declines appear to have flatlined around 1.5%. Occupancy is falling but at a slower pace than a few months ago. With additional supply delivering, especially in the southeast and Texas, occupancy will likely decline for the foreseeable future.
Key Takeaways – Data as of 11/19/2023
Traffic and Leases:
Occupancy and ATR:
Net Effective Rent:
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