Q2 2012 Buffalo, New York Apartment Property Sales Analysis

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Q2 2012 Buffalo, New York Apartment Property Sales Analysis


Apartment investment activity has been slow. Following the three transactions meeting Reis’ criteria that closed during the first quarter for a combined total of just $12.7 million, no sales were completed the quarter after. The 12-month rolling mean cap rate per the second quarter was 7.0%, down from 8.0% four quarters prior.

Commentary on investment. “All time low mortgage interest rates available through mortgage programs specifically tailored to the multifamily segment have pushed sale capitalization rates to all time lows in the upstate New York apartment market,” stated an article in published in the New York Real Estate Journal in July. “Freddie Mac and Fannie Mae are quoting ten year mortgages near 4%. There is huge interest in apartment investment properties and combined with the real rent growth of the last few years, investors are willing to accept lower cap rates. There is no other investment alternative that delivers the same level of return.”