• Multifamily apartment rents are likely to slump, according to Ivy Zelman and Scott Trench.
  • Insider spoke to the Zelman and Associates founder and the BiggerPockets CEO about their views.
  • Zelman said home prices might decline into 2025, while Trench was more optimistic.

Housing market expert Ivy Zelman and real estate investing pro Scott Trench approach the housing market from very different perspectives, but they can still see eye-to-eye on some things.

Zelman, a former Credit Suisse analyst who co-founded her own firm in 2007, has made her name by accurately forecasting the ups and downs of the US housing market over the last few decades. Trench is an author, podcaster, and the CEO of real estate investing platform BiggerPockets, which boasts more than 2 million users.

Both Zelman and Trench spoke to Insider in late April in separate interviews, and the two had similar views on a couple of major points.

For instance, both agree that the rental market for larger apartment buildings is headed for a very difficult period.

“It feels like a storm is really brewing on multifamily, at least in terms of pressure on lease rates,” Zelman said. Trench went even further, saying he expects a crash in the multifamily apartment prices soon.

There are two straightforward reasons for that. First, a huge number of multifamily apartment buildings have recently been built, and after a short period of rapid growth, rent growth was already due to come down to a more normal pace. Zelman says it’s been about 80 years since this much supply entered the market in such a short period.

“That will disproportionately hit the South and the West and I think that’s where you’re going to see pricing pressure on properties and less rent growth,” Trench said. “If you own apartment complexes, you should be worried.”

The two real estate pros took different stances when it comes to the single family housing market, however. Trench says that in 2024, first-time homebuyers might be able to secure a good deal on a house. 

“Single family houses, especially new ones, might be cheaper for first-time homebuyers,” he said. Trench also noted that as long as interest rates are stable, or even headed lower, investors have a good chance at finding success with the “BRRR” house flipping strategy and portfolio building strategy that BiggerPockets has often touted to would-be housing market investors.

“BRRR” was a hit in a lower-rate environment, especially as housing prices climbed over the last few years. While 20% annual home price appreciation isn’t in the cards anymore, he said that the strategy should still work — especially for renovators who can work quickly and really add value to the properties they’re buying.

Ivy Zelman is a housing expert who identified the market bubble in the 2000s and called the housing market turnaround in 2012.

Zelman & Associates

Zelman, however, is far more cautious about the trajectory of housing prices, and she argued that the lack of supply on the market is not going to be a good thing.

The forthcoming recession is going to trump all other housing market price trends, she predicted, and there will either be a correction in interest rates or in housing prices. She also said the most likely outcome is that demand will “putter out” because the market of people who want to move is so much smaller than it used to be.

“Demand is negatively impacted for two-thirds of the market,” she said, because about half of all homeowners have locked in mortgage rates of under 3.5% and about 90% borrowed at a rate under 5% — compared to the current national average of 6.3%.

“There’s a disincentive to move even though you have substantial equity,” she explained, though she added that prices should firm up and turn again in 2025.