5 Major Trends in Multifamily Real Estate
One major trend in the housing market right now is the rise in the popularity of multifamily housing. Multifamily units tend to be large blocks split into apartments that provide an excellent option for a comfortable living space to those who cannot afford to buy single-family homes, such as younger adults, or those residents who would rather forgo the costs and responsibilities of home ownership altogether. Read on to discover five of the most current and major trends in multifamily real estate right now.
1. The Rise of Smart Design for Multi-Family Housing in the Real Estate Industry
The rise of intelligent design in multifamily real estate has been a significant trend over the past decade. Smart design allows housing construction developers to build properties from start to finish while at the same time, better utilizing space and creating living spaces that are attractive, comfortable, and modern. The type of living spaces more people are crying out for, especially at a reasonable price.
The type of smart design technology features commonly included in multifamily rental housing and apartments include open floor plans with flexible layouts, which provide a sense of space even in a smaller building. Energy-efficient appliances and low-flow fixtures are also popular right now, as are automated lighting systems which can help to both improve the quality of life for those living in the space while also saving money and preserving energy at the same time. The latter is vital for typical renters in the multifamily residence market such as young adults, as many millennials are very concerned with their impact on climate change.
2. Increasing Demand for Affordable Multifamily Housing
The demand for affordable multifamily housing units compared to single-family homes is on a rapid rise. This all-time high is because of a range of factors, including rising home prices and mortgage rates, rising interest rates, fast population growth, and the increasing cost of living in many cities, as well as other factors.
This means that rent growth trends are up as multifamily properties offer renters a more affordable housing option while still providing access to good schools, high walkability scores or transportation options, and entertainment venues. To meet this growing need, developers are focusing on designing smaller rentals that are both attractive and cost-effective.
Indeed, we expect increased demand in the multifamily housing market to remain strong and continue to rise at a faster pace into 2023.
3. Innovations in Financing & Investing Opportunities for Multifamily Properties
Among the many trends happening in the multifamily real estate sector, innovations in financing and investment opportunities are some of the most significant right now. Real estate investors are offering new investment strategies, such as real estate investment trusts (REITs), refinancing activity, and crowdfunding platforms, providing increased access to capital for multifamily real estate developers.
Traditional lenders are also expanding their range of products to meet the growing demand for long-term investments in multifamily apartment buildings.
4. Emphasis on Community-Centric Amenities in the Multifamily Rental Market
Developers of multifamily housing have emphasized community-centric features to create a sense of community and attract more investors and residents. These include features like common areas, professional services, shared green spaces, rooftop gardens, fitness centers, and bike storage. Community-centric features help to improve the residential experience of communities in large metropolitan areas and smaller cities.
Community-centric amenities benefit not only the multifamily residences that inhabit them but the surrounding neighborhoods as well. Not only do these amenities encourage increased community engagement, but they also bring about a sense of pride and purpose for the residents and the neighborhood. By providing a space for socializing, recreation, and gathering, these amenities can positively impact the overall quality of life in the area and create a more vibrant and livelier atmosphere. In addition, these amenities enhance the resident experience, making them more desirable to potential renters or buyers, which in turn boosts resident satisfaction and retention rates for you.
5. Leveraging the Benefits of Technology for Efficiency and Connectivity
Property managers are leveraging the benefits of technology to increase efficiency, connectivity, and convenience for residents and future households. This includes using digital tools for marketing and leasing with virtual staging and tours proving to be especially effective and popular right now.
Also, multifamily property investors are deploying smart home devices in units to control energy consumption, offering video surveillance systems for security concerns, and utilizing automated systems like package lockers to streamline operations. Technologies such as these are becoming increasingly popular, making multifamily properties more attractive, efficient, and secure.
We’re Here For Your Construction Needs
As we’ve shown, the multifamily commercial real estate market is rapidly evolving and rising over the last few years. Savvy real estate investors are always looking for the best opportunities to maximize their returns and diversify their portfolios, so it’s important to stay up to date on the latest trends. Contact the Rockford Construction team to learn more and to ensure your multifamily real estate developments are trending in your favor.