U.S. Apartment Sales Drop Off

"U.S apartment sales cooled off significantly in Q4 2022-- though the drop wasn't maybe as severe as some expected given headwinds like rising cost of debt, cooling fundamentals and relatively modest movement (generally) in seller pricing expectations. 

MSCI Real Capital Analytics did report a 20 bps increase in cap rates (up to 4.9%) in Q4, and although that probably understates re-pricing on many deals, the trend is notable -- as it's the largest QoQ increase in cap rates since 2008. That's noteworthy, but...

... let's not overreact, as buyers are still taking on deals with lower yields than in past few years (reflecting that investors with capital on hand still favor multifamily and SFR over other options), and cap rate expansion usually isn't keeping up with interest rates."