Freddie Mac Multifamily 2022 Outlook Projects Another Strong Year for Multifamily Investment

Rhea-AI Summary

Freddie Mac's annual multifamily outlook forecasts a continued growth in multifamily origination volume for 2022, estimating a range of $475 billion to $500 billion. Rent growth is expected across all markets, with the Sun Belt outperforming others. However, after a robust 2021, growth is likely to moderate due to inflation and COVID-19 variants concerns. The report anticipates a 4% rent increase and flat vacancy rates at 4.8%. Freddie Mac remains a leader in multifamily housing finance, emphasizing affordable housing for low-to-moderate income families.

Positive

• Projected multifamily origination volume growth to $475 billion-$500 billion in 2022.
• Rent growth forecasted at around 4% across all markets.
• Strong demand for existing multifamily properties supported by elevated permits and starts.

Negative

• Growth expected to moderate due to inflation and COVID-19 variant concerns.

MCLEAN, Va., Jan. 10, 2022 (GLOBE NEWSWIRE) -- Freddie Mac’s (OTCQB: FMCC) annual multifamily outlook estimates that overall multifamily origination volume will continue to grow in 2022 to between $475 billion and $500 billion. The report projects rent growth in all markets in 2022, with the Sun Belt markets expected to outperform the nation as smaller markets in the Northeast and Midwest grow at a slower rate. The economic rebound in 2021 resulted in a robust year for the multifamily market, but this growth is expected to moderate in 2022 as concerns about inflation and variants of the COVID-19 virus mount.

“We believe the market will continue to grow in 2022, reflecting the strong multifamily fundamentals that drove the market to a record-breaking year in 2021,” said Steve Guggenmos, vice president of Multifamily Research & Modeling at Freddie Mac. “We anticipate rent growth in all markets in 2022 due to strong demand driven by improving economic conditions.”

The Multifamily 2022 Outlook outlines several key findings:

• Growth Continues but Moderates: Coming off a record-breaking year in 2021, Freddie Mac expects multifamily markets to continue their growth, albeit at a more subdued pace. Demand for existing multifamily properties is expected to remain strong and, given recent elevated levels of permits and starts, completions should also remain elevated.
• Rising Rents Across the Board: Each market Freddie Mac tracks is projected to experience rent gains. The Sun Belt markets are generally expected to outperform the nation, while the smaller markets in the Northeast and Midwest are generally expected to see comparatively slower rent growth. Overall, rent growth in 2022 is forecasted to be around 4% and vacancy rates are expected to remain flat at 4.8%.
• Increased Multifamily Lending: Considering the robust performance and strength of the apartment market, Freddie Mac expects originations in 2021 to grow to $450 billion, and to see further growth to $475 billion-$500 billion in 2022.
  

Freddie Mac Multifamily is the nation's multifamily housing finance leader. Historically, more than 90% of the eligible rental units we fund are affordable to families with low-to-moderate incomes earning up to 120% of area median income. Freddie Mac securitizes about 90% of the multifamily loans it purchases, thus transferring the majority of the expected credit risk from taxpayers to private investors.

Freddie Mac makes home possible for millions of families and individuals by providing mortgage capital to lenders. Since our creation by Congress in 1970, we've made housing more accessible and affordable for homebuyers and renters in communities nationwide. We are building a better housing finance system for homebuyers, renters, lenders and taxpayers. Learn more at FreddieMac.com, Twitter @FreddieMac and Freddie Mac's blog FreddieMac.com/blog.

MEDIA CONTACT: Mike Morosi
(703) 918-5851
Michael_Morosi@FreddieMac.com

FAQ

What is Freddie Mac's projected multifamily origination volume for 2022?

Freddie Mac projects multifamily origination volume to be between $475 billion and $500 billion in 2022.

What rent growth is expected in 2022 according to Freddie Mac?

Freddie Mac forecasts a rent growth of around 4% across all tracked markets in 2022.

How are the Sun Belt markets expected to perform compared to other regions?

The Sun Belt markets are expected to outperform other regions in rent growth in 2022.

What are the anticipated vacancy rates for multifamily properties in 2022?

Vacancy rates in 2022 are expected to remain flat at 4.8%.

What concerns could affect Freddie Mac's growth in 2022?

Concerns about inflation and COVID-19 variants could moderate the growth in 2022.