US apartment cap rates for transactions of 5 million or more, stood at 6.8% in the second quarter of 2009, just 10 basis points up from the rates that prevailed in the previous quarter and 30 basis points up compared to the second quarter of 2008, according to data provided by Real Capital Analytics (RCA) and published by Mortgage Bankers Association (MBA).
According to the historical quarterly data provided, which start from the first quarter of 2004, apartment cap rates for 5M+ transactions increased 60 basis points since the fourth quarter of 2007, when they averaged 6.2%.
The highest cap rate of 7% is reported for the first quarter of 2004. Since then, US apartment cap rates for transactions of 5 million or more kept declining until the fourth quarter of 2005 when they bottomed at 5.8% (120 basis point drop). Since then apartment cap rates have been mostly on an upward path until the second quarter of this year.
Since the first quarter of 2004, the largest year-over-year drop in US apartment cap rates took place in the third quarter of 2005 when they dropped to 5.9% from 6.8% in the third quarter of 2004. The largest annual increase of 60 basis points was posted in the fourth quarter of 2008 when cap rates were up to 6.8% from 6.2% in the fourth quarter of 2007.
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