Multifamily professionals expect the political climate in Washington, D.C. may have a negative impact on the industry in 2019, according to a Capital One survey of over 100 multifamily professionals at the National Multifamily Housing Council’s annual meeting. The survey also found that while 70 percent of respondents believe the economy is approaching the end of its current cycle, professionals remain optimistic about industry fundamentals.
 
Forty-three percent of survey respondents view the current political climate as a detriment to activity in the multifamily industry, with just 28 percent foreseeing a positive impact. This is a sharp change from professionals’ thoughts in late January 2017—the last time the survey was conducted—when 73 percent of respondents saw the D.C. political climate as a benefit to the industry.
 
At the same time, professionals see strong fundamentals in multifamily. Thirty-seven percent of respondents cited this as the biggest positive factor for the sector in the year ahead. Multifamily professionals also named availability of capital and job growth as positives for 2019.
 
“Despite the impact of some external pressures and uncertainties, we’re looking at a multifamily industry that is confident in its core fundamentals,” said Jeff Lee, President, Capital One Multifamily Finance. “Supply is tracking well with demand, and both buyers and sellers remain optimistic about economic conditions.”
 
When asked about the biggest challenge facing the multifamily industry in 2019, nearly half (48 percent) of all respondents pointed to rising costs in their markets as their top concern. Rising interest rates were seen by less than a quarter (22 percent) of respondents as the biggest hurdle for the industry, down significantly from 52 percent of respondents who said so in 2017. Pointing back to the industry’s strong fundamentals, just 16 percent cited supply/demand imbalances as their top concern.