Epidemic Year: Spring Market Forecast 2021
The COVID-19 epidemic has changed the world in many ways than we could ever have imagined. The family homeland industry has been hit hard as many tenants have experienced unfortunate circumstances, including unemployment, which has led to Hebrew payments and deferrals.
While this will be a long road to recovery, the multi-family industry is expected to see much-needed growth soon. The National Housing Association (NAA) predicts that while “general market fundamentals are expected to be weak by 2021, there is much backlash for multi-family demand on the other side of the plague.”
According to Pio’s research center, 26.6 million 18-29 year olds live with their parents because of the epidemic strain and the growing gap between apartment prices and rent growth. ² While working remotely is an option for some. Not the case for many. As the restrictions imposed during the locking begin to shrink and employees begin to return to the office, a gated demand for residence in the apartment is expected.
Free levels before COVID and increase in rates
Many city residents left the apartments to stay in their parents ’home, forcing apartment owners and property managers to lower rents and waive commissions and fines for delinquency. However, CBRE expects vacancies before COVID and a 6% increase in effective net rent during 2021.³ While many properties have offered unprecedented concessions to help fill vacancies, these are likely to start to fade as demand increases.
Mortgage rates fell sharply in 2020, and apartment purchases appear to have increased. However, this wave will begin to slow down as life begins to return to normal and rates will begin to rise. Renting will remain an attractive option for many who do not want to commit to a mortgage with so much uncertainty.
Growth in the suburbs will continue to rise
It is no secret that the suburban market flourished during 2020 as many left the city for the suburbs. Rental units in suburban markets will continue to see growth in rental prices and lower levels of vacancies, as many have adapted to this new lifestyle.
Virtual shows and apartment tours
Although many Americans have started getting vaccinated, potential tenants may still be uncomfortable visiting apartments in person. It will be critical for properties to provide as much information as possible on internet lists and will be open to virtual shows and 3D tours to attract tenants.
Recovery will be slow at first, but a strong future is expected, with experts showing a full recovery in the market in 2022. With the ever-changing landscape for property managers to navigate, digital marketing remains an important tool to put your properties in front of tenants while they are on their way to finding their next home. RentPath offers a portfolio of solutions to help you achieve your maximum exposure to the most qualified tenants.