- February 21, 2019
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If the thought of becoming an investor in the multifamily real estate market has ever crossed your mind, now is the time to act! In fact, there’s never been a better time to be a landlord in multifamily real estate, and here’s why…
Rental Demand is High
All across America, markets are seeing increased demand in the multifamily real estate sector. While there are several reasons for this, let’s take a look at a few of the more prominent ones.
- Millennials: Over the past decade, millennials have begun to infiltrate the multifamily market as they come of age. A large portion of this generation has traded the traditional route of instantly starting a family and buying a home in for the new normal of travel and experience. This means that, rather than becoming locked in to lengthy mortgages, this demographic is allured by the short-term commitment offered by rental agreements and the freedom associated with that.
- Baby Boomers: Another demographic greatly affecting the demand for multifamily real estate is the baby boomers. As this age group leaves the workforce, more and more are also choosing to downsize from their large family homes, opting instead for apartments, retirement communities, or condos with far less upkeep.
- Difficulty Securing Mortgages: Lastly, the ability to secure a mortgage for a single-family home has become more and more difficult over the course of the past few years. Many of those trying are finding that they are frustrated with the process and instead, choosing to continue on renting until the next shift comes.
Low Vacancy Rates
As demand for multifamily real estate grows, vacancy rates become lower and lower. This is beneficial in many ways, some more obvious than others. For one thing, keeping a unit occupied obviously means that the income from that property is consistently coming in, ensuring that your investment has a lucrative return. Additionally, as demand increases, more and more tenants are choosing to stay put instead of checking out other properties. Without the constant turnover, the act of being a landlord becomes exponentially easier. The opportunity is created to really build rapport with your tenants, so that you know what to expect from them and they from you. Knowing who you are working with leaves a lot of the guesswork and frustration out of the tenant/landlord relationship. Lastly, a greater demand for quality rental property gives you, the landlord, a much broader spectrum of choice when it comes to picking a new tenant. More applications mean access to a greater pool of quality tenants with clean background checks and proven payment histories, thus eliminating many potential problems down the line.
Owning multifamily real estate also comes with its own set of huge tax deductions (many that vary state to state). Many of these deductions will benefit you two-fold. How? Take, for example, the idea of making improvements to your property. Lots of multifamily properties are beginning to make green upgrades and to incorporate eco-friendly options for their tenants. Upgrading appliances and/or using materials that are considered “green” will not only qualify you for many government deductions, but they will also increase the value of your property. In other words, it’s a win-win on either end. Increased value means access to more quality tenants, the ability to charge a premium price when put up against comparable properties, and greater tenant retention.
Lastly, becoming a landlord in multifamily real estate has truly never been easier. The old days of endless apartment tours and stacks of unnecessary paperwork are long gone and have been replaced with the ease and access of the internet. These days, being a landlord who keeps your apartment rentals filled is much more about working with the right real estate agent and/or management company who can help keep them pertinent. More and more landlords are choosing to hire companies or individuals who can create 3-Dimensional and virtual tours of their properties so that prospective tenants can get a feel for them on their own. Rental applications are more and more commonly going digital as well, adding even further to the ease of being a landlord.
Looking for Multifamily Real Estate in Baton Rouge or the Surrounding Areas?
Now that it’s obvious that right now is the perfect time to invest in multifamily real estate, what are you waiting for? Quality properties won’t stay on the market for long, so there’s no time like the present. Luckily for you, SVN | Graham, Langlois & Legendre, LLC has done all of the footwork for you, creating an impressive database of some of the best multifamily investment opportunities the Baton Rouge area has to offer. Take a look through them today and reach out to one of our team members to get searching!