Multifamily loan origination volumes this year are expected to reach between $370 billion and $380 billion, according to a projection by Freddie Mac. That compares to last year’s expected volume of $320 billion. While this year’s volume is expected to easily surpass last year’s, it’s still well behind the $480 billion of originations recorded in 2022 and the $485 billion in 2021.
Cap rates generally are a function of interest rates. As they climb, so would cap rates, all other things remaining equal. Despite this, originations are expected to increase this year as the lack of affordable homes should increase the pool of apartment renters, helping the performance and values of those properties.
Source: High Rates, High Vacancies: Why Freddie Mac Still Projects Multifamily Loan Origination Growth
