Prices on Apartment Buildings Continue to Climb

New York, NY, October 18, 2016— Investors continue to offer higher and higher prices for apartment properties relative to the income the properties produce—months after the market seemed to have peaked, reports National Real Estate Investor Online.

“The thing that surprised me a bit about the last six months was the robustness of pricing in the apartment market,” says James Costello, senior vice president for New York City-based research firm Real Capital Analytics (RCA).

After a slow beginning to the year, cap rates in the apartment sector continued their relentless downward path, with the average cap rate on sales of midrise and high-rise apartment buildings just 4.9% in August. The average cap rate for sales of garden apartment properties was 5.8%; both of those figures are 20 basis points lower than they were during the same period the year before, according to RCA.