According to data provided by the [National Multifamily Housing Council's Rent Payment Tracker](https://www.nmhc.org/research-insight/nmhc-rent-payment-tracker/), across the United States, 84% of tenants paid their rent by April 12th. This compares to 90% the year prior, a 7% decline from March rent. We expect May rent performance will be worse, given limited savings, continued record jobless claims and delays disbursing unemployment benefits and payroll protection loans.

 

## Consumer Spending

 

The US is a consumption-driven economy. Consumer spending comprises roughly 70% of GDP. According to Wells Fargo, consumer spending is down 35% at this point compared to same time last year. As you read this and think about your own changes in spending, this probably sounds quite accurate to you.

 

If consumers don't spend, businesses can't pay employees, tenants can't afford rent. Rent rates either need to be reduced or landlords need to accept lower rent revenue vis-à-vis higher non-payment rates. Other things could happen like employees forced to take pay cuts to keep their jobs, which will have a similar effect. Or we see a material shift from homeownership to renting as people lose their homes which might support rent rates... Lots of different scenarios to consider.

 

To put it another way, lower rental income results in lower [net operating income](https://offermarket.us/real-estate-glossary/noi-net-operating-income) (NOI) which results in lower valuation.

 

## Insight From The Public Markets

 

Looking at public markets, Equity Residential (EQR) is down 25%, AvalonBay (AVB) is down 29% from February 21 highs. Income producing properties are valued based on cap rate, so from this perspective we should expect valuations to decline in the near term. This said, the Fed is pumping money into the economy which as we saw in the Great Recession should cause asset values to increase both as means of chasing yield with interest rates near zero and as a hedge against inflation (holding cash is not good in that environment).

 

## Facing Reality

 

We don't see consumer spending snapping back to pre-COVID levels quickly. This will take time as the consumer needs confidence that their health and job is safe before spending on non-necessities, things that bring them out of their homes. We wonder if this economic shock might condition business and consumer spending to be more frugal over a longer time horizon.

 

## Summary

 

We do believe multifamily residential asset valuations will decline in the near term (now through mid-2021), but continue to serve as attractive long-term investments.

 

That's just our 2 cents, we are not economists but we are data-driven buy-and-hold value investors. What are your thoughts? Are you buying now or are you waiting on the sidelines?

 

## About OfferMarket

 

OfferMarket is a marketplace for single family (SFR) and multi-family rental investment properties. If you are a residential real estate investor or looking to start investing, OfferMarket is for you.

Analyze the data on how COVID-19 is affecting multifamily real estate valuations.

How will COVID affect multifamily real estate valuation?

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## What areas in Louisiana do you serve?

We serve all major metropolitan areas of Louisiana. We aim to provide financing in the areas with highest population densities and sizes. That is one of the reasons we can't lend on rural properties. Here is the list of Louisiana areas that we serve and their respected population sizes, largest employers, top university and public school systems as well as most desirable zip codes that benefit the most from economic development in the wider areas.

 

**Lafayette, LA**

 

The Lafayette area has seen strong population growth driven by its energy and healthcare industries, with Lafayette Parish itself growing around 6% between 2010-2020. Major employers include Lafayette General Health, University of Louisiana at Lafayette, Bell Helicopter, Bollinger Shipyards, and others. With construction starts up only 20% over historical averages compared to the population boom, there could be a potential undersupply of housing if starts don't increase further. This supply/demand imbalance presents a favorable climate for rental investors in the area. Now let's look at specific zips of interest:

 

- 70506 - Hosts major employer University of Louisiana at Lafayette (2,500 emps & 19,000 students, ranked 281 nationally). Population growth has been robust but housing starts lag, pointing to potential rent growth over the next 5 years as supply remains constrained.
- 70501 - Home to Lafayette General Health (4,000 emps). Rents have already increased 15% over the past 3 years as the zip remains a desirable area with limited new construction.
- 70508 - An affluent area where high-end home values have soared. While multifamily is limited, the strong rent growth fundamentals make it an appealing zip for build-to-rent investors. We have a perfect product offering for this situation, called Build to Rent, you can get an [Built to Rent instant quote](https://www.offermarket.us/loans) here.

 

**Lake Charles, LA**

 

Calcasieu Parish, home to Lake Charles, grew over 5% between 2010-2020, fueled by the petrochemical and LNG industries. Major employers include Sasol, Cheniere Energy, and McNeese State University. With construction starts only up 5%, generally in line with population growth, the housing supply appears able to meet demand currently. This relatively balanced market presents a stable environment for rental investors in the area. Specific zips of interest:

 

- 70601 - Hosts Sasol's large chemical plant (3,500 emps). Population influx has driven steady rent growth of 3-4% annually over the past few years.
- 70605 - Home to Cheniere's LNG export terminal (800 emps). Newer residential developments here but housing pipeline appears sufficient for now.
- 70615 - Near McNeese State University (7,000 students). Student population supports stable rental demand, though rent growth has been more muted.

 

**Baton Rouge, LA**

 

While East Baton Rouge Parish itself saw modest growth, surrounding parishes like Ascension (+16%), Livingston (+12%), and West Baton Rouge (+9%) expanded rapidly as the Baton Rouge area grew outward. The region's economy is anchored by the ExxonMobil refinery, Baton Rouge General Hospital, LSU, and industrial employers. With construction booming 30% above average, housing supply does not appear constrained compared to population growth currently. But pockets of tighter rental markets exist:

 

- 70810 - Desirable zip code near LSU (31,000 students) and major employers. Rents have climbed 25% since 2017 amid strong demand.
- 70737 - Part of fast-growing Ascension Parish. New apartment construction has lagged single-family housing, creating a potential opportunity.
- 70809 - Close to the ExxonMobil refinery (6,500 emps). Older housing stock and limited new rental units have allowed for steady rent appreciation.

 

**New Orleans, LA**

 

After population losses from Hurricane Katrina, the New Orleans area has rebounded, led by 12% growth in St. Tammany Parish from 2010-2020 as suburban areas expanded rapidly. The presence of Tulane University and the Stennis Space Center provide economic anchors. However, with construction lagging 10% below historical averages compared to surging population growth, an undersupply of housing is a potential concern looking ahead for rental investors:

 

- 70002 - Located in St. Tammany Parish near Slidell. Robust apartment demand has driven 8% annual effective rent growth over the past 3 years.
- 70448 - Close to Stennis Space Center (5,000 emps) on the Northshore. New housing construction has not kept pace with job growth.
- 70131 - A desirable residential area of New Orleans seeing a renaissance after Katrina. Limited developable land signaling potential rent growth.

 

**Northshore, LA**

 

Tangipahoa (+6%) and St. John the Baptist (+5%) parishes saw solid growth along the Northshore between New Orleans and Baton Rouge. Major employers include North Oaks Medical Center, Marathon Petroleum, and Southeastern Louisiana University. With construction generally on par with averages but lagging population growth in some areas, rental investors should monitor for potential undersupply:

 

- 70454 - Home of Southeastern Louisiana (11,000 students). Student rental demand and limited new housing have allowed for annual rent gains over 5%.
- 70058 - Residential suburb near Marathon refinery (800 emps). New home and apartment construction has picked up but may still fall short.
- 70403 - Affluent zip in St. Tammany Parish. Persistent demand and barriers to new supply point to long-term rent growth potential.

 

## Where can I find investment properties in Louisiana?

 

There are many online and offline places where you can find investment properties. Some of them include:
1. OfferMarket - Get an instant email alert when a new property is listed in your target area. [Instant off market listing alerts](https://www.offermarket.us/listings?alerts=true)
2. Craigslist - Craigslist's local marketplace is perfect for finding sellers who want to work directly with the buyer.
3. Zillow - Zillow should always be part of any experienced real estate investor just to keep tabs on what the general market in their target area is doing. You can [save search](https://www.zillow.com/homes/) on zillow to get email updates regarding your target area.
4. Redfin - Redfin should also be used for understanding local market trends. Set up [email notifications for Redfin here](https://www.redfin.com/myredfin/notification-settings).
5. Facebook Marketplace - Facebook Marketplace is a new comer to the list. Should be part of everyone's toolkit.
6. Ebay - Yes, you heard it right, ebay can also be a great place to find properties.

 

## Are you able to lend on rural properties?

 

We can't lend on rural properties. How can I find out, if my property is rural? Here are more detail on how to verify if your property is rural in our [Rural Designation Search Tools](https://www.offermarket.us/blog/rural-designation-search-tools). The 2 search tools are hosted by USDA Rural Development Property Eligibility and CFPB Rural and Underserved Areas Checker. Both of the tools must flag the property as not rural for it to be eligible for our funding. Use these instruction to find out [if your property is considered rural](https://www.offermarket.us/blog/rural-designation-search-tools)

 

## Do you do cash out refi no seasoning for Louisiana loans?

 

We do offer refinance options with no seasoning requirements. Here is the general criteria for cash out refi no seasoning for Louisiana loans. Easiest way to see if you qualify is to answer a few question in our [online quoter](https://www.offermarket.us/loans). It will compare all of our lending criteria against your answers and give you a response in under 1 minute without you needing to read anything. If in case you want to do it the hard way, please read on to see some of the guidelines below with a [full list of our requirements here](https://www.offermarket.us/blog/cash-out-refi-no-seasoning).

 

Minimum loan amount has to be above $55,000. Minimum As-Is value on the appraisal has to be $100,000. Between 1-4 units. Must have an active lease with proof of security deposit collected. Property condition must be [C4 or better](https://www.offermarket.us/blog/property-condition-ratings-c1-c2-c3-c4-c5-c6). Minimum credit score of 680. Credit score between 680 to 699, gets maximum LTV of 70%, credit score of 700+ gets maximum LTV of 75%. Max LTC, 100% (less than 90 days seasoning), 140% (90 to 179 days seasoning). Minimum verified rehab, 20% of purchase price (less than 90 days seasoning), n/a (90+ days seasoning). Minimum verified rehab, is an improvement that has been done to the unit to verify increase in as-is value in such as short period of time (less then 90 days) to justify the no seasoning period. Origination fee of 1 to 2 points depending on the loan amount to keep the lights on. Lender fee, $1,995 (doesn't go to OfferMarket), includes multiple fees to several different 3rd party verification services, necessary to certify the information in the Loan File for closing. Appraisal at AMC market price, we also have a promotion that new clients get 100% of their appraisal refunded at closing and 50% refund for existing clients. Time to close, 20-25 days.

 

I know this is a lot of information. You don't have to lift a finger to calculate any of this to see if you qualify, all you have to do is answer 14 simple questions about your deal and we will tell you if we are a good fit for you and what kind of deal we can offer you. To get an answer on your specific situation, please answer 14 simple questions here in our [online quoter for Louisiana DSCR loans](https://www.offermarket.us/loans).

 

## Can you lend on properties worth less then $100k?

 

In short, no, appraisal as is value must come in at above 100k. We can only lend on properties that are less then $100k if they are in a portfolio with other properties and the portfolio's total as-is value on the appraisal is above $250k. In order to qualify for our loans, the property must appraise for at least $100k as-is at the time of the appraisal, however, total loan amount may be less then 100k, minimum loan amount is $55k.

 

## Do I need to have my property insured to qualify for funding?

 

Yes, but if you don't already have insurance, we can roll it into the lending process with no extra charge or effort to you. Our insurance team works with thousands of carriers and is intimately familiar with the insurance requirements of your loan. They will be able to ether talk to the agent of your choice or find the most competitive offer without our network of carriers to complement your loan with no extra effort or expense to you. If you already have insurance, you should get an instant quote to see if we can offer you a more competitive rate and save you thousands of dollars over the lifetime of your policy. [Get you instant insurance quote](https://www.offermarket.us/insurance) here.

 

## How Do DSCR Loans Work in Louisiana?

 

The overall process of getting a DSCR Loan in Louisiana is approximately as follows. You submit an application for a loan (you can get started on your loan with an [instant quote](https://www.offermarket.us/loan)) answering 14 questions about your property. An instant quote will tell you if you qualify for the loan in under 1 minute of your time. It will also show you the a preliminary interest rate and loan amount. Once you select desired LTV (which can be changed later), your quote will be converted to a Loan File for processing purposes.

 

You will have to submit documents as part of your Loan File for underwriting. Documents we may ask for will include personal and property documents such as purchase contracts, current leases, borrowing entity documents, deeds, title work (we will engage a title company or an attorney on your behalf to draw up these documents), background and credit reports (that we will order), bank statements for liquidity verification as well as other documents that may be applicable to your specific deal. Full list of requirements can be found here in [DSCR loan requirements](https://www.offermarket.us/blog/dscr-loan-requirements).

 

We will also handle all the aspects of scheduling and appraisal for you. Please note that we have a promotion, where new clients receive a 100% refund at closing for their appraisal and existing clients forever get a 50% refund for their appraisal at closing as our way to say thank you for allowing us to partner with you! Once all the loan documents are submitted, the Loan File goes through underwriting, at which point the underwriting committee may ask for additional documents depending on their discretion. Once the committee receives all the documents and approves the file, closing can be scheduled.

 

The closing, will be handled by the title company or at the office of closing attorney. Once closing is complete, funds will be wired. Post closing, the loan will be entered into servicing and you will receive information regarding setting up auto-pay or other options that may be available for your loan depending on the specific servicer's capabilities.

DSCR Loan Louisiana offers real estate investors the opportunity to secure financing based on debt service coverage ratio to optimize their investment returns.

DSCR Loans for Rental Property Investors in Louisiana

DSCR Loan Louisiana

DSCR Loan Illinois offers real estate investors the opportunity to secure financing based on debt service coverage ratio to optimize their investment returns.

DSCR Loans for Rental Property Investors in Illinois

DSCR Loan Illinois

Grow your real estate investing business with the most competitive DSCR loan product. OfferMarket also provides DSCR rental loans, bridge loans, hard money, fix & flip, rehab, ground up construction loans.

Rental Loans

The Lock In Effect

Real Estate Investing Sayings

This is an important question that deserves careful consideration in order to be a successful real estate investor.

 

Let's start with *first principles* -- what do we know to be true about real estate?

 

- Real estate is capital intensive
- Capital intensive industries require financing
- Increases in interest rates make it more expensive to finance real estate
- When real estate becomes more expensive, demand goes down
- When demand goes down, prices appreciate slower or decline

 

## The Lock In Effect

 

As interest rates have rapidly risen from historic lows, home owners that would otherwise consider selling are having a difficult time justifying trading in a home financed at an interest rate in the high 2s or 3s for a home in the 6s or 7s. As a result, if interest rates remain elevated, we believe there will be less selling. Less selling means less inventory (supply). This will support elevated home prices, or at least reduce the chances that we see a broad decline in home prices.

 

## Real Estate Investing Sayings

There are a few sayings that drive home the answer to this question: 

 

- *Time in the market is better than timing the market.*
- *Don't wait to buy real estate. Buy real estate and then wait.*
- *Marry the deal, date the rate.*
- *Buy the best and wholesale the rest.*

 

##

Is now a good time to buy real estate? This is an important question that deserves careful consideration in order to be a successful real estate investor.

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Is now a good time to buy real estate?

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The Lock In Effect

Real Estate Investing Sayings

* Takes 2 minutes, no credit pull