Affordable Housing is Ruling the Multifamily Real Estate Market in 2020
Over the course of 2020, investors have seen significant volatility in sectors that are traditionally characterized by stability and steady growth. There has been a continually increasing interest in investment opportunities that offers better consistency and reliability as well as the possibility of considerable expansion and development within the near future, The affordable housing market is a welcome haven for investors who are looking to invest safely, responsibly, and also ethically.
Meeting Increased Demand
While many segments of the broader market are subject to fluctuation as consumer demand changes, the demand for affordable housing continues to rise. The limited availability of affordable housing for individuals and families is not adequate to meet the current demand. Investors in multifamily real estate can be assured that they will see a steady return on their investments when they set their properties’ rents in accordance with HUD’s fair market values and exercise good management practices.
In far too many cities across the county, entire income brackets have been wholly pushed out of the communities where their families have lived for decades. People are unable to afford housing in the communities in which they work. Skyrocketing housing costs that are wholly disproportionate to increases in income; while the cost of rental housing has soared in many major metropolitan areas over the last twenty years, wages have remained stagnant. Creating more affordable housing opportunities preserves the quality of life in cities whose housing market has spiraled out of control. Moreover, it serves low and moderate income families who have been marginalized and prevented from accessing quality housing in desirable areas.
Working With Key Programs
While some political leaders with very little understanding of the housing market have attempted to depict affordable housing as a threat to suburban areas, well-informed local officials and discerning investors know that this is simply not the case. Housing subsidies that can be used to develop and rent multifamily real estate are a vital tool that promote community safety and stability. State-run programs and funding made available through federal initiatives such as HOME and the LIHTC program are an invaluable lifeline to communities everywhere. Not only do they benefit the people who live in properties that are benefited by these programs, they create a strong and predictable source of revenue for individual investors, syndicates, and development companies.
Ultimately, the affordable housing market is reasonably expected to continue growing over the course of the next decade. Investors who pursue this path can see sizeable profits while also helping to address long standing inequities in the housing market.