What Should Landlords Expect Ahead in 2024: Realtor Report

Investment Volume Continued to Fall in Q4 link

• U.S. commercial real estate investment volume plummeted by 44% year-over-year in Q4 2023 to $81 billion, marking the lowest annual total since 2012 at $348 billion. This represents a significant slowdown in the market.

• Multifamily properties led the investment volume in Q4 with $26 billion, followed by industrial & logistics at $19 billion and office spaces at $14 billion. This highlights the continued interest in residential and industrial sectors.

• Private investors dominated the quarter, contributing $51 billion or 63% of the investment volume. Meanwhile, cross-border investment fell by 30% year-over-year to $4.7 billion, indicating a shift in investor dynamics and confidence.

What Should Landlords Expect Ahead in 2024: Report from Realtor.com link

• Landlords face increasing costs: Over 60% of landlords report a rise in ownership costs by up to 10% in the past year, pushing many to raise rents, though the pace of increases may slow.

• Rent increases are selective: While over half of landlords observed local rent hikes, the trend towards raising rents is declining, with a more cautious approach for existing tenants to maintain occupancy.

• Renters squeezed financially: The average rent ranges from $1,000 to $2,000, with many renters saving less and cutting back on other expenses due to high rent costs.

• Credit scores become a focus: Amid financial strains, nearly half of renters are unsure if their rent payments are reported to credit bureaus, yet those who do report see it as beneficial for their credit health.

• Homebuying aspirations dim: With savings challenges and high interest rates, fewer renters are considering buying a home, and a significant portion is delaying purchase plans.

• Stability in landlord portfolios: Despite market uncertainties, most landlords aim to maintain their current portfolio size, with a decrease in those planning to sell and a cautious approach towards buying new properties

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Here are the Best-Performing US Cities According to the Milken Institute link

• The Milken Institute's annual report ranks 403 U.S. metropolitan areas, focusing on economic growth, affordability, resilience, sustainability, and income inequality.

• Top-ranked large city: Austin-Round Rock, Texas. Other top-ranked large cities include Provo-Orem, Utah, Salt Lake City, Utah, Charleston-North Charleston, South Carolina, Elgin, Illinois, Houston-The Woodlands-Sugar Land, Texas, and Richmond, Virginia.

• Top-ranked small city: Idaho Falls, Idaho. Other top-ranked small cities include Coeur d’Alene, Idaho, Twin Falls, Idaho, Pocatello, Idaho, and Wenatchee, Washington.