CEO Hessam Nadji of Marcus & Millichap joined "Mornings with Maria" Wednesday to discuss the strong demand for apartment rentals as the housing market sees a multitude of challenges following the pandemic.
HOME AFFORDABILITY IS AT AN ALL-TIME LOW, SAYS PERSONAL FINANCE EXPERT
HESSAM NADJI: Well, the rapid rise in interest rates is causing a lot of concern, especially in the housing market. Affordability is already a challenge. Nationwide, prices for homes are up 36% since the pandemic began. So since the end of 2019, we have some metros like Phoenix, Austin, Atlanta, where home prices have increased 50% since the onset of the pandemic. That's not sustainable. But on top of that, the higher interest rates, which came very quickly in the last few months. And, of course, affordability gets even more challenged.
We're seeing a lot of people opt for renting apartments. The demand for apartment rentals was already very strong. It's getting even stronger. Apartment rent growth for the first quarter, year over year, almost 18% nationwide. And so investment dollars are coming into commercial real estate, especially apartments, self-storage, hospitality. All those segments are doing very well or recovering pretty quickly.
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