New cyclical low in U.S. multifamily vacancy due to robust renter demand

Multifamily fundamentals in the U.S. recorded continued growth for 2018 as full-year absorption levels hit a new high and national vacancy rates decreased to reach their lowest point in this cycle. Las Vegas, Orlando and Phoenix were among the best-performing markets, with rents improving more than 7% in 2018. Although unit deliveries retreated from their cyclical high in 2017, the year ahead is projected to see another wave of new developments hindering further rental gains in the near term. The construction pipeline is expected to slow in the latter half of 2020, allowing for stronger future rental growth, while housing affordability constraints and low unemployment are anticipated to help support demand for new multifamily units in the mid-term.

Global Residential Clocks – Rents

Click on a regional clock to view city positions

U.S.: Multifamily Residential

EMEA: Central City

AP: Prime Residential

Source: JLL, January 2019

High investment volumes across Europe

The institutional residential market in Europe continues to record strong activity, with volumes increasing in 2018 in Germany, the Netherlands and Spain. The UK had a breakthrough year for investment activity in the multifamily sector despite Brexit uncertainties, with 2018 volumes surging by 143% compared with 2017 to around £5.5 billion off the back of 50 deals. The market’s geographical spread is now broadly equal between London and the rest of the UK, a demonstration of the growing confidence in the sector.

Government cooling policies continue to play a role in several Asian markets

In Asia Pacific, tightening policy measures, cautious sentiment and an influx of new supply impacted sales volumes in Greater China, while the effects of tightening measures introduced earlier in the year continued to be felt in Singapore.

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