Arm yourself with the knowledge you need to maximize your multifamily investing this new year and beyond
Whether you’re buying or selling, understanding what’s important to renters is essential to making the best possible multifamily investment decisions.
As a buyer, rental trends can provide you with the insights you need to pick a property that’s desirable to your ideal tenants when you or your property management company begin accepting applications.
If you’re a seller, you can analyze rental trends to determine the changes you can make to your property to make it more attractive to buyers who are only interested in investing in the best that the market has to offer.
To help, we’ve compiled a list of the most pertinent rental trends you need to keep in mind as you invest in multifamily in 2022:
National Rental Trends
- The popular prediction that people would leave cities due to the COVID-19 pandemic was found to be incorrect with 50% of renters staying in the same city. [1]
- After a few years of a steady increase, the amount of renters that said gyms were a must-have amenity fell 6%. They were also less concerned with other community recreation spaces like rooftop gardens and game rooms, likely spurred by the pandemic’s need for social distancing measures. [1]
- 85% of renters said that an increase in rent impacted their decision to move, and 81% said finding a rental within their initial budget was the most important factor when choosing a new place to live. [1]
- Technological capabilities have become more important to renters, thanks to society’s increased reliance on technology in the past couple years.
- 52% of renters typically pay rent online. [1]
- 35% of renters sign leases digitally. [1]
- 64% of renters feel that a 3D home tour is more effective in a listing than regular photos. [1]
- Nearly 1 in 4 renters found a new place to live without visiting it in-person, likely thanks to remote tools giving them all the information they needed to make an informed decision. [1]
- Floor plans are important to renters with 71% agreeing they were more likely to look at a home if they liked the floor plan included in the listing. [1]
- The biggest reason that renters move is due to a life event with 35% saying it was because of a growing family and 33% at least in part because of a new job. 29% of renters who moved reported working from home more often as a reason for their move. [1]
- 61% of renters apply for two or more properties when finding a new place to live—an 11 point increase from 2019—and 79% of renters are at least somewhat certain they will qualify when they apply. [1]
- 88% of renters pay a security deposit and the typical price is $700, a $50 increase over 2020. [1] When it comes to security deposits for single-family vs. multifamily, single-family are typically twice as expensive as multifamily properties. [1]
Orlando Rental Trends
- The average monthly rent for an apartment in Orlando is $1,733 and the average apartment size is 963 square feet. [2]
- Orlando renters pay more than 30% of their monthly income on housing. [3]
- There is an increased demand for both single-family and multifamily housing in Orlando with approximately 1,000 people moving into Central Florida every week. [3]
- According to the U.S. Census, over 390,000 people moved to the Greater Orlando area between 2010 and 2020 with only 112,000 of those new residents from natural population growth. [4]
- Orlando multifamily occupancy increased to reach 96% over the past year, and there are over 16,500 new units expected to be complete by June 2022. [5]
- Orlando is experiencing record-high rent growth with the average effective rent increasing to $1,405 per month. [6]
- 70,000 jobs were created in the Orlando Metro Area in 2021, increasing 6% overall which is higher than the national average of 4.6%. [6]
Did you find these rental trends insightful?
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Sources:
1: Zillow | Zillow Rentals Consumer Housing Trends Report 2021
2: RENTCafé | Orlando, FL Rental Market Trends
5: Lima One Capital | Orlando is a Magic Kingdom for Multifamily Real Estate Investment