The status of commercial real estate varies drastically depending on the asset class. A confluence of factors — many stemming from the pandemic — means investing in multifamily housing in 2022 could generate a significant ROI for owners and investors.
Covercy experts share the best multi family real estate markets, and we break down the various reasons these markets are growing so quickly.
Multifamily property owners must consider how to manage investor relations, banking and account creation under each asset, how to extend capital calls and distribute payments each quarter, and of course how to report on performance. Read Covercy's take on the best way to manage all of the above.
The ongoing pandemic, the dramatic rise in remote work, consumers’ desire for more living space, the growing popularity of specific communities, and other factors all led to strong performance in real estate multifamily investing throughout 2021 and early 2022. While some of that growth has slowed down due to inflation, the multifamily market is still continuing to edge upward in performance.
According to the June 2022 Rental Report from Redfin, rents in June were up 14% year-over-year — and that was one of the smallest increases since Q4 2021. Despite a cooler summer for the market, multifamily investment growth is expected to continue in the future. This is based on industry research surrounding the state of the U.S. population, the current rental market, and various trends that can make an impact.
According to the National Multifamily Housing Council, the U.S. needs 4.3 million more apartments by 2035 to meet existing demand. Current supply levels are low, and a variety of factors are contributing to this increased need. Not every state or region across the country is seeing this growth, however. Of the hundreds of major metropolitan areas, some are seeing more noticeable growth than others. As a result, GPs and investors looking to build and grow a portfolio of multifamily properties should focus their efforts where the opportunities and potential for strong returns are the greatest.
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