March 2025
Some of our thoughts on the mixed picture for the multifamily housing market. Locally, leasing is picking up, but concessions and value-oriented rates have been driving tenant decisions. The hope is that increased demand will shift negotiations and reduce concessions as the year progresses. Acquisition efforts for a high-quality asset in 2025 were unsuccessful, but searching continues. Industry-wide, uncertainty persists due to fluctuating interest rates, impacting debt costs and property values. A gap between buyer and seller expectations is slowing transactions, but long-term optimism remains, fueled by expectations of stabilizing supply and strong demand. Inflation and economic indicators are being closely watched, with a potential for increased investment activity in 2025 despite higher interest rates.
January 2025
Things are off to a slow start this year. We saw a seasonal slow down late last year, which has made clearing any vacancies slower that usual. However things are picking up and new lease rates are trending slightly better than exiting tenants. I expect leasing to get back to full speed shortly.
For those of you with student properties, we are seeing about 50% renewing in 2025 on average with modest increases in rates. Butte College enrollment is up 9% compared with last spring and CSUC was up 3% in Fall 2024 year over year. Those are modest but good trends.