Despite the worries that the U.S. economy may be heading for a downturn, economists and apartment experts alike are left scratching their heads after seeing recent construction and occupancy numbers both continue to grow upwards.
Growth Across the Board
In July of 2019, 321,000 new units in buildings with 5 or more units were constructed in the United States, according to The US Census Bureau. Coupled with a staggering July occupancy rate of 96.2 percent, the highest since the year 2000, this is certainly great news for apartment investors and construction contractors alike.
Occupancy Rates Soar
With waning confidence in the markets and the economy, many older homeowners are preemptively downsizing by selling off their single-family homes, moving closer to work, and opting to rent apartments to prepare for a possible downturn. Millennials are also continuing to rent for longer periods, as they are finding they need time to pay off debts, and also enjoy the amenities found within apartment living. This is vastly increasing the demand for multifamily property and apartment units, and likely helping to drive the recent numbers.
Rents See Increase With Demand
As both older and younger generations are renting at growing rates, rent prices too are starting to trend upward as demand increases. Last year rent prices increased between 4.2 and 5 percent depending on size.
Existing Property Values Up
With so many new units being constructed at such a staggering rate, existing property is also being primed for value increases. Owners are taking advantage of this, and apartment investors are finding themselves in a buyer’s market, netting better deals within this sector of the multifamily real estate world.
Are you interested in investing in multifamily properties? Would you like to further your education and knowledge in apartment investing? Brad Sumrok’s comprehensive apartment investment courses teach you everything you need to know when it comes to learning how to make investments in apartments. Check out Brad Sumrok’s online courses, mentoring program, and live events here, and see which is right for you.