Albuquerque apartments are getting healthier.
Borrowing is still expensive.

The economy is slowing, but it is not falling apart.

The U.S. economy grew at a 1.5% annual rate in the second quarter, down from 2.1% in the first quarter. Employers cut 23,000 jobs in July, while unemployment held at 4.1%. Job openings rose slightly, but companies hired fewer people.

In plain language, employers are becoming more careful. That matters to apartment owners because steady jobs support rent payments and household formation. A gradual slowdown is manageable. A sharp increase in unemployment would be more concerning.

Inflation is still the main reason rates may remain high. The Fed’s preferred inflation measure was up 3.7% from a year earlier in July. Inflation excluding food and energy was 3.3%. Both are still above the Fed’s 2% target.

More loans are getting done, even though money is not cheap.

Commercial and multifamily mortgage lending increased 16% from a year earlier in the second quarter. Multifamily lending alone increased 8%. This shows that lenders are becoming more active again.

At the same time, U.S. multifamily sales volume fell 2.7%, and sales of individual properties fell 10.4%. Those numbers are not contradictory. Lending includes refinances as well as property purchases. Owners may be finding new loans even while buyers and sellers still disagree on price.

For buyers: more active lenders can create better choices on loan structure and terms. The payment is still high, so the property’s current income must support the debt.

For owners: a healthier lending market can bring more qualified buyers to the table. Properties with organized records, stable occupancy and believable expenses should benefit first.

Apartment demand is now growing faster than new supply.

Across the country, 167,000 additional apartments became occupied during the second quarter, while developers completed about 77,700 new units. Demand was more than twice the amount of new supply, and all 69 markets tracked by CBRE had positive demand.

National rents increased only 0.5% from a year earlier, so this is not a rent boom. The encouraging part is that new construction is slowing. Completions fell 14% from a year earlier and are expected to keep declining.

When fewer new buildings open, existing properties face less competition. Owners may need fewer concessions, and buyers can have more confidence that recent rent softness may improve over time.

The local numbers moved in the right direction.

Albuquerque occupancy reached 95.9% in the second quarter, up from 94.9% in the first quarter. New-lease asking rents were still slightly lower than a year ago, but the decline improved from 2.3% in the first quarter to just 0.7% in the second.

That does not mean rents are suddenly taking off. It means the market is doing a better job filling the apartments that were recently added. One quarter is not enough to predict a major rent increase, but the direction is encouraging.

New supply is also becoming less of a concern. Albuquerque added 813 units during the past year. Only 574 units remained under construction at the end of the quarter, and Colliers expects just 336 units to open during the next four quarters.

For owners: stronger occupancy can lead to fewer concessions and steadier income. Good collections and careful expense control still matter.

For buyers: I would rather buy while the market is beginning to improve than after everyone agrees it has improved. Price still matters. A property should work on today’s rents and expenses, with future improvement treated as upside.

Current job growth is modest, but several new projects are worth watching.

Albuquerque had about 416,000 nonfarm jobs in July, almost unchanged from a year earlier. Education and health services grew 4.4%, while professional and business services declined 5.6%. New Mexico’s unemployment rate was 4.8%.

This is a steady job market, not a fast-growing one. Apartment demand is strongest when many industries are adding jobs, so I would not base a property purchase on one large announcement.

Still, the future pipeline is interesting. Pacific Fusion started work on a planned $1 billion research and manufacturing campus at Mesa del Sol. BlackVe opened a new facility near Kirtland Air Force Base and plans to add 152 high-paying jobs over the next decade. The state and city also committed $1.5 million to support Quantinuum’s expanding Albuquerque research hub.

These projects support Albuquerque’s strengths in national security, engineering, aerospace and advanced science. They may help housing demand over time, but the timing and location of that demand still need to be proven.

The property market is improving before financing becomes easy.

Four signs will show whether the improvement continues.

1. August jobs · September 4

The next jobs report will show whether July’s decline was temporary. Stable employment would support renter demand.

2. August inflation · September 11

Lower inflation could take some pressure off interest rates. Higher inflation could keep borrowing expensive.

3. The Fed · September 15–16

The Fed’s decision will affect short-term borrowing costs and could also move longer-term Treasury rates.

4. Albuquerque rents and concessions

Occupancy improved. The next question is whether owners can reduce concessions and begin raising effective rents without losing that occupancy.

The market is improving. The individual property still has to make sense.

If you are considering an Albuquerque multifamily purchase or sale, I can compare the property with current rents, expenses, financing, nearby competition, recent sales and new supply in its submarket.