February 2025 Insights: Increasing Market Activity
Increasing Market Activity
We have discussed multifamily transaction volume, or the lack thereof, ad-nauseum over the last 2.5 years, as we have seen volumes fall 70%+ from 2022 levels. At the risk of getting ahead of ourselves, we are encouraged to point out that there has been a significant increase in multifamily assets listed for sale over the last 4 weeks. For context, we reviewed over 150 for sale assets that fit our buy box over the first two months of 2025, which is a 200% increase over the same period in 2024.
Properties being listed for sale is step one of the process, but just because a seller is listing a property for sale, doesn’t mean that property is priced appropriately. That said, we have seen a narrowing of the bid/ask spread between buyers and sellers, which may ultimately result in transaction volume ticking higher. For example, we offered on a property in Texas last week and it received over 40 offers, which is a sign that the property was aggressively priced and indicative of a transaction that will eventually close. While this number of offers is an outlier as the broker was looking to create a bidding war, I take this anecdote as a positive sign that we are moving to a point in the cycle where sellers are coming to grips with the reality that if they want to sell their asset, that sales price is likely 20-40% below its 2022 valuation.
Recent Acquisitions: Performance Update
Completing a value-add business plan is typically a 2 year process, so we wanted to share an update on the progress of our last two acquisitions, both of which were made within the last 14 months.
LuxLiv Apartments
Reedville Meadows Apartments
What We Do
We are strategic real estate investors.
At Vanamor, we combine an institutional approach with an often overlooked middle-market focus to employ a flexible and disciplined investment philosophy. Our goal is to provide stable cashflow with above-market total returns. Since inception, Vanamor has averaged a greater than 33% annual return with an average of 8% annual cashflow distribution.
