Multifamilies overpriced?
A new survey of commercial real estate professionals has found that while multifamily homes were believed to be the best commercial investment, they may be becoming overpriced.
In their national quarterly market trends report, the Certified Commercial Investment Member (CCIM) reported their members ranked the investment potential of multifamily properties highest among commercial properties, giving them a 4-out-of-5 rating. Industrial properties were believed to be the next best investment at 3.7 out of 5.
However, those same surveyed professionals only gave multifamily properties a 2.8 out of 5 for value, indicating that many CCIM members feel that multifamily investments are overpriced. Industrial properties fared best on value, receiving a 3.2 out of 5 rating.
Concern over the value of multifamily homes is backed up locally by extreme growth in the sector throughout Massachusetts.
The median price of a three-family home in Massachusetts has soared 83 percent since 2009, with Worcester and Middlesex counties seeing jumps of 52 and 56 percent, respectively, according to The Warren Group, the Boston-based real estate data firm. During that time, the median price of a single-family home rose a relatively paltry 16 percent statewide.
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