Apartment buildings will continue to be a good investment: Here’s why

October 8, 2019 | Blog | Market Insights

With a potential recession on the horizon, many investors are struggling to decide where their money will be the safest.

Keep reading to learn why the investment experts at 100Units.com believe that the multifamily sector—and apartment buildings, in particular—will continue to be a good investment choice, both in the short term and in the longer term.

Multifamily is well-positioned for a recession
In the face of a recession, industry experts view multifamily real estate as a more stable sector than other portions of the economy.

For apartment buildings specifically, it’s predicted that net operating income growth may slow in the short term, but investors who are committed to the long term (10+ years) should be able to rest easy and enjoy a respectable return on their investment.

Read more: How to prepare for the next real estate downturn

Demand continues to outpace supply
For many, apartment renting provides a more affordable option that also offers more flexibility than owning a home. Younger Americans, in particular, are seeing a lower net worth coupled with rising student debt—leading to increased demand for cost-effective rental options.

Job growth, especially in areas like Orlando (which boasts the fifth-most job openings per person of all major markets) is another driving force in this increased demand for apartment buildings.

This same demand is being observed across the entire Sunshine State: it’s estimated that Florida cities will need more than 669,391 new apartments combined by 2030 to meet needs.[2]

Prime location and upgraded amenities
Apartment living can often be a more affordable and flexible prospect for renters, when compared to a single-family home. The locations of apartment buildings are often preferable too, generally closer to downtown areas and close to good transport links.

Along with a prime location, many apartment buildings offer upgraded amenities like next-gen lighting, advanced security, and smart appliances and thermostats. Communal amenities may include a fitness center, swimming pool, clubhouse, and recreational areas.

What does the future hold for apartment investments?
Our multifamily opinion: if you own an attractive, well-maintained apartment building, you’re in a great position to enjoy a reliable stream of steady income for years to come.

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  1. Bisnow.com
  2. 2019 Housing Affordability Toolkit


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