April Pulse Check

Friend,

Last week’s inflation news wasn’t good. CPI rose 0.4% again in March, following the same in February, and 0.3% in January. Fearing that a June rate cut by the Fed is off the table and uncertain about the possibility of subsequent rate cuts this year, markets reacted strongly, pushing yields on the ten-year UST to 4.65% at this writing.

The last mile of the inflation fight is going to be bumpy.

For months, we have all been leaning into the hope and expectation of rate cuts this year. First, it was six cuts, then maybe four, and then three. Now, no one is sure, and the talk is again of “higher for longer.” Once again, it’s “Stay alive until ‘25”.

As difficult as it is – and as eager as we all are to get back to closing deals – we’ve made a lot of progress. Inflation has fallen dramatically over the past two years, from a high of 9.1% in June 2022 to an annual rate of 3.5% in March. The economy is growing, consumers are spending, and the trends are, for the most part, positive.

And yet, a positive economic outlook does not necessarily mean good things for CRE and multifamily. The ULI Real Estate Economic Forecast, presented at the ULI Spring Meeting in New York last week, reinforced that idea. The report includes a consensus view that rates are still likely to fall slowly to 4.0% this year and 3.75% next year, but inflationary pressures from things like investments in energy transition, geopolitical factors, continued labor shortages, and the federal deficit will mean that the path will be, well, bumpy.

Those of us in multifamily are, by nature, optimistic. We have to be optimistic in order to make long-term investments and take long-term risks, but we also tend to think that the way things are right now—in good times and bad—is the way they will always be. It just isn’t so.  

Here's to the last mile, lower rates, and deals that pencil. The day will come.

At AGM, we do our best to keep developers informed of proactive measures you can take to get the most from every deal. Please schedule a call if you have questions or want to discuss your next project. 

Current Rates

In The Community

Eastern Lenders Association’s 2024 ELA Conference

AGM was well represented at the recent 2024 ELA Conference in Baltimore. The conference was engaging, featuring informative panels, influential speakers, and numerous opportunities to connect with industry experts. AGM’s President, Myles Perkins, and several others from AGM attended the conference. Participants heard updates from HUD and attended panels on emerging environmental issues, current trends in public/private partnerships, and reviews of national and regional market conditions.

The Eastern Lenders Association (ELA) is a non-profit consortium of FHA-approved Multifamily Lenders and industry partners in the Northeast Region. Its purpose is to foster communication and collaboration between its members and HUD Multifamily Leadership and staff. ELA’s Annual Conference is important for maintaining relationships and fostering dialogue with HUD.

Maryland Affordable Housing Coalition (MAHC) Housing 

Myles Perkins, AGM’s President and MAHC Board Member, joined by Margaret Allen, AGM’s CEO, and AGM staffers Brian LaChapelle, Steve Rudow, and Matt Daddio, participated in Housing Day, Maryland Affordable Housing Coalition’s annual advocacy event held in Annapolis, MD during the Legislative Session.

Housing Day draws over 200 affordable rental housing advocates to the State capital to support affordable housing in Maryland. On Housing Day, MAHC members meet with members of the House and Senate to impress upon them the importance of affordable housing. Affordable housing is critical to Maryland families, creates jobs, and contributes to the state’s economy. Housing Day encourages legislators to include affordable housing in the legislative agenda.