The multifamily property market has enjoyed several years of rapid growth. According to a recent report published by Freddie Mac, this growth seems poised to continue throughout 2017, although at a more moderate pace. But what does this mean in terms of return on investment for your multifamily property? Here are three key takeaways from the report and what it means for you.
Economic Growth
The economy added 2.2 million jobs in 2016, with average hourly earnings rising 2.9 percent over the past year. Great news – this increase is predicted to continue throughout 2017. Job growth in Orlando is expected to be among the highest in the country, not least because the city falls into the Sun Belt, a strengthening region characterized by a warmer climate and a relatively lower cost of living, which attracts people from across the country.
Demand for Multifamily Property
With employment growth higher than population growth and wages rising, the demand for multifamily units remains robust. Rents are growing in line with 2016, and are predicted to maintain this strong upward trajectory. The strengthening wage growth has supported strong demand for multifamily rental units. This is because more and more households are being formed, and are choosing to rent due to demographic shifts and lifestyle preferences.
New Construction
To keep up with the rise in renter households, multifamily construction has reached the highest levels since the late 1980s. However, vacancy rates should remain flat throughout 2017 as the demand for rental units is increasing in line with the completion of new multifamily properties.
You can read the full report here. All of this is great news for an investor in multifamily property! Economic growth and higher wages mean that people are looking to rent larger units in more affluent areas, and despite new construction and completion, vacancy rates show no sign of increasing. If you own a multifamily property you can be safe in the knowledge that you will continue to reap the benefits of your investment. For sellers, now is a great time to think about increasing rents up to market, to make your property look even more attractive to buyers.
If you need help understanding the market and preparing your property for sale, the team at 100Units.com are here for you. Our objective as your multifamily advisor is to help you achieve your investment goals. We’ll lend you our unique perspective on your situation and provide you with real time market analysis to help you stay ahead of every changing market trends. We’ll also collect, study, evaluate, and share market data on an ongoing basis to help you make timely and informed decisions. From determining the best listing price to coordinating a smooth closing process, we’ll facilitate a smooth transaction for you. Contact us today to get started.