2023 Year In Review with Team Burns-Botsford

$776mm+ Funded | 26 Deals Closed | 9 States

46% Refinance - 35% Acquisitions

As we reflect on 2023, the financial landscape at Walker & Dunlop has been marked by unprecedented challenges, particularly in the realms of rate volatility and acquisition market dynamics. For Team Burns-Botsford, these hurdles have been met with resilience, strategic planning, and a proactive approach by our dedicated team.

Challenges Faced: Rate Volatility and Acquisition Market Standstill

2023 witnessed significant interest rate volatility, which presented a significant hurdle in the ability to underwrite both debt and equity. In the second half of the year, the acquisition market came to a standstill due to a discord between sellers and buyers regarding property values and cap rates.

• Rate volatility presented difficulties in processing loans, affecting both elective refinances and acquisition financings.
• The acquisition market faced a slowdown due to disagreements on property values and cap rates.

Overcoming Challenges as a Team: Proactive Strategies and Collaborative Efforts

In the face of these challenges, Team Burns-Botsford embraced a proactive and strategic approach to ensure continued success in a volatile market.

• Upfront Underwriting and Preparation: We adopted a strategy of thorough prep work and upfront underwriting on every deal, allowing us to move swiftly when market conditions were favorable.
• Client Empowerment: Positioning our clients to act quickly during favorable rate conditions proved to be a key success factor.
• Refinement of Refinance Options: Our team ran extensive models and analyses to help clients understand refinance options, especially in the context of existing floating-rate loans.
• Proactive Client Engagement: We actively engaged with clients facing loan maturities and offered creative solutions for unique deals. This was integral to our clients' success in 2023.

Looking Ahead to 2024: Strategic Predictions and Client-Centric Focus

As we step into 2024, we anticipate a stabilization of rates, albeit without a guaranteed downward trend. Team Burns-Botsford's predictions for the upcoming year include:

• Downward Pressure on Values: Distressed property sales may exert downward pressure on property values.
• Resurgence of Acquisitions: The acquisition market is expected to rebound, with a preference for 5-year fixed-rate loans.
• Election Year Influences: Predictions lean towards lower rates, driven by the dynamics of an election year, leading to increased activity in acquisition financing and elective refinances.
• Inflation Challenges: Inflation might prove to be stickier than anticipated, compelling the Fed to maintain a restrictive policy throughout 2024. Interest rate cuts may not be as aggressive or quick as the market is currently expecting.
• Emphasis on Workforce Housing: Fannie and Freddie will continue to place a strong emphasis on loans secured by properties that are affordable to tenants earning 80% and 100% of AMI. The agencies will offer the best pricing and, in certain scenarios, more aggressive underwriting metrics on these transactions.

Our team remains committed to providing innovative solutions, staying ahead of market trends, and being the go-to partner for our clients' diverse financial needs. As we navigate the uncertainties of the future, our focus remains on delivering excellence and adding value to every transaction.

Contact Team Burns-Botsford today at [email protected] to talk about how we can help you with your multifamily financing needs.

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